CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES

9 Months Ended

Dec. 31, 2012

CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES

NOTE 4 – CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents and those investments with original maturities greater than three months to be marketable securities. Cash and cash equivalents consisted of money market instruments and cash maintained with various financial institutions at December 31, 2012 and March 31, 2012.

Marketable Securities

The following is a summary of marketable securities held by NetScout at December 31, 2012 classified as short-term and long-term (in thousands):

	Amortized Cost		Unrealized Gains		Fair Value
Type of security:
U.S. government and municipal obligations	$	15,751	$	5	$	15,756
Commercial paper		13,587		0		13,587
Corporate bonds		3,076		0		3,076
Certificates of deposit		2,905		0		2,905
Total short-term marketable securities		35,319		5		35,324
U.S. government and municipal obligations		10,019		1		10,020
Corporate bonds		518		2		520
Total long-term marketable securities		10,537		3		10,540
Total marketable securities	$	45,856	$	8	$	45,864

The following is a summary of marketable securities held by NetScout at March 31, 2012, classified as short-term and long-term (in thousands):

	Amortized Cost		Unrealized Gains (Losses)			Fair Value
Type of security:
U.S. government and municipal obligations	$	17,779	$	20		$	17,799
Commercial paper		22,469		0			22,469
Corporate bonds		18,531		(1	)		18,530
Certificates of deposit		3,208		(1	)		3,207
Auction rate securities		17,612		0			17,612
Total short-term marketable securities		79,599		18			79,617
Auction rate securities		1,651		(190	)		1,461
U.S. government and municipal obligations		13,828		8			13,836
Corporate bonds		1,345		2			1,347
Total long-term marketable securities		16,824		(180	)		16,644
Total marketable securities	$	96,423	$	(162	)	$	96,261

Contractual maturities of the Company’s marketable securities held at December 31, 2012 and March 31, 2012 were as follows (in thousands):

	December 31, 2012		March 31, 2012
Available-for-sale securities:
Due in 1 year or less	$	35,324	$	79,617
Due after 1 year through 5 years		10,540		15,183
Due after 10 years		0		1,461
	$	45,864	$	96,261

During the quarter ended June 30, 2012, redemptions for the Company’s remaining auction rate securities totaling $19.3 million were settled, $17.6 million of which were classified as current marketable securities as of March 31, 2012 and another $1.7 million classified as long-term marketable securities. As a result of the settlements, during the three months ended June 30, 2012, the Company reversed the remaining valuation reserve of $190 thousand ($117 thousand, net of tax) previously recorded within accumulated other comprehensive income (loss) on the balance sheet. The Company held no investments in auction rate securities at December 31, 2012.