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Fair value measurements
 3 Months Ended
Jun. 30, 2013
Fair value measurements [Abstract]  
Fair value measurements

4. Fair value measurements:

 

The following table presents the level within the fair value hierarchy at which the Company's financial assets are carried at fair value and measured on a recurring basis: 

 

(In thousands)

 

 

 

 

 

 

 

 

                                                                                                                                                                                                                                                                                                                                                         Description

 

Fair value at

June 30, 2013

 

Quoted prices in active markets for identical assets

(Level 1)

 

Significant other observable market inputs

(Level 2)

 

Unobservable market inputs

(Level 3)

Money market accounts

 

$

757,877

 

$

757,877

 

 

–

 

 

–

Municipal bonds and notes

 

 

34,872

 

 

–

 

$

34,872

 

 

–

Commercial paper

 

 

134,456

 

 

9,835

 

 

124,621

 

 

–

Variable rate demand notes

 

 

13,650

 

 

–

 

 

13,650

 

 

–

Auction rate securities

 

 

3,198

 

 

–

 

 

–

 

$

3,198

Certificates of deposit

 

 

130,935

 

 

5,990

 

 

124,945

 

 

–

Corporate bonds

 

 

1,542,627

 

 

–

 

 

1,542,627

 

 

–

Government agency bonds

 

 

251,917

 

 

–

 

 

251,917

 

 

–

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Description

 

Fair Value at

March 31, 2013

 

Quoted prices in active markets for identical assets

(Level 1)

 

Significant other observable market inputs

(Level 2)

 

Unobservable market inputs

(Level 3)

Money market accounts

 

$

818,474

 

$

818,474

 

 

–

 

 

–

Municipal bonds and notes

 

 

46,877

 

 

–

 

$

46,877

 

 

–

Commercial paper

 

 

168,639

 

 

31,815

 

 

136,824

 

 

–

Variable rate demand notes

 

 

1,500

 

 

–

 

 

1,500

 

 

–

Auction rate securities

 

 

3,198

 

 

–

 

 

–

 

$

3,198

Certificates of deposit

 

 

90,268

 

 

5,981

 

 

84,287

 

 

–

Corporate bonds

 

 

1,509,870

 

 

–

 

 

1,509,870

 

 

–

Government agency bonds

 

 

278,804

 

 

–

 

 

278,804

 

 

–

 

 

 

1

 


FOREST LABORATORIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

The Company determined fair value based on a market approach using quoted market values, significant other observable inputs for identical or comparable assets or liabilities, or discounted cash flow analyses. The Company determines the value of the auction rate securities portfolio based upon a discounted cash flow model.  The assumptions used in the valuation model include estimates for interest rates, timing and amount of cash flows, and expected holding periods for the auction rate securities.

 

There were no purchases or sales of Level 3 investments during the three-month period ended June 30, 2013.

 

The majority of the Company's non-financial assets and liabilities are not required to be carried at fair value on a recurring basis.  However, the Company is required on a non-recurring basis to use fair value measurements when analyzing asset impairment as it relates to goodwill, license agreements, product rights, other intangible assets and long-lived assets.  The carrying amount of cash, accounts receivable and accounts payable and other short-term financial instruments approximate their fair value due to their short-term nature.