Fair Value of Financial Instruments (Tables)

9 Months Ended

Sep. 29, 2012

Fair Value of Financial Instruments

Financial assets and liabilities measured at fair value on a recurring basis

	Fair Value Measurements at September 29, 2012 Using
Description	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Assets:
Cash Equivalents:
Money market funds	$	54,619	$	—	$	—	$	54,619
U.S. Treasury bills	15,999		—		—		15,999
Total cash equivalents	$	70,618	$	—	$	—	$	70,618
Short-term Investments:
Corporate bonds	$	—	$	63,149	$	—	$	63,149
Municipal bonds	—		30,010		—		30,010
U.S. government bonds	12,670		—		—		12,670
Asset-backed securities	—		11,997		—		11,997
Variable-rate demand notes	—		19,281		—		19,281
U.S. Treasury bills	8,499		—		—		8,499
International government bonds	—		2,967		—		2,967
Total short-term investments	$	21,169	$	127,404	$	—	$	148,573
Long-term Investments:
Auction rate securities	$	—	$	—	$	11,418	$	11,418
Total long-term investments	$	—	$	—	$	11,418	$	11,418
Total	$	91,787	$	127,404	$	11,418	$	230,609
Liabilities:
Derivative instruments	$	—	$	699	$	—	$	699
Contingent consideration	—		—		4,004		4,004
Total	$	—	$	699	$	4,004	$	4,703

	Fair Value Measurements at December 31, 2011 Using
Description	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Assets:
Cash Equivalents:
Money market funds	$	50,851	$	—	$	—	$	50,851
Total cash equivalents	$	50,851	$	—	$	—	$	50,851
Short-term Investments:
Corporate bonds	$	—	$	75,060	$	—	$	75,060
Municipal bonds	—		56,984		—		56,984
Variable-rate demand notes	—		41,280		—		41,280
U.S. government agency	—		19,836		—		19,836
U.S. Treasury bills	8,600		—		—		8,600
Asset-backed securities	—		5,739		—		5,739
U.S. government bonds	2,507		—		—		2,507
Certificates of deposit	—		1,570		—		1,570
International government bonds	—		950		—		950
Total short-term investments	$	11,107	$	201,419	$	—	$	212,526
Long-term Investments:
Auction rate securities	$	—	$	—	$	17,477	$	17,477
Total long-term investments	$	—	$	—	$	17,477	$	17,477
Total	$	61,958	$	201,419	$	17,477	$	280,854
Liabilities:
Derivative instruments	$	—	$	1,998	$	—	$	1,998
Contingent consideration	—		—		876		876
Total	$	—	$	1,998	$	876	$	2,874

Summary of quantitative information about level 3 asset fair value measurements

Auction rate securities

Fair Value at September 29, 2012 (000s)		Valuation Technique	Unobservable Input	Weighted Average
$	11,418	Discounted cash flow	Estimated yield	1.25%
			Expected holding period	10 years
			Estimated discount rate	2.74%

Summary of quantitative information about level 3 liability fair value measurements

Contingent consideration

Fair Value at September 29, 2012 (000s)		Valuation Technique	Unobservable Input	Weighted- Average	Range
$	4,004	Probability weighted discounted cash flow	Estimated outcomes if milestone goals are achieved	$4.2 million	$0.1 million - $7.6 million
			Estimated probability of achieving each outcome	15%	3% - 33%
			Estimated discount rate	5.15%	n/a

Summary of activity in Level 3 financial instruments

Assets

Auction Rate Securities	Three Months Ended		Nine Months Ended
Beginning balance	$	11,028	$	17,477
Settlements	—		(6,700		)
Gains included in other comprehensive income	390		641
Balance at September 29, 2012	$	11,418	$	11,418

Liabilities

Contingent Consideration (1)	Three Months Ended		Nine Months Ended
Beginning balance	$	—	$	876
Issuances	4,004		4,004
Gain recognized in earnings (2)	—		(876		)
Balance at September 29, 2012	$	4,004	$	4,004

(1)In connection with the acquisition of Ember and ChipSensors, the Company recorded contingent consideration based upon the achievement of certain milestone goals. Changes to the fair value of contingent consideration due to changes in assumptions used in preparing the discounted cash flow model are recorded in selling, general and administrative expenses in the Consolidated Statement of Income.

(2)The Company reduced the estimated fair value of contingent consideration because certain milestone goals were not achieved.