2. Investments

The Company classifies its short-term investments as "available-for-sale" and records such assets at the estimated fair value with unrealized gains and losses excluded from net loss and reported, net of tax, in comprehensive income (loss). The portion of such unrealized losses that are deemed to be other-than-temporary in nature are charged to the statements of operations. The basis for computing realized gains or losses is by specific identification. In addition, the Company had approximately $0.9 million in restricted cash related to its voluntary disability insurance program as of March 31, 2012 and 2011 and is included in cash and cash equivalents on the consolidated balance sheet.

The following is a summary of available-for-sale securities (in thousands):


	March 31, 2012								March 31, 2011
	Amortized Cost		Gross Unrealized				Estimated Fair Value		Amortized Cost		Gross Unrealized				Estimated Fair Value
	Amortized Cost		Gains		Losses		Estimated Fair Value		Amortized Cost		Gains		Losses		Estimated Fair Value
Cash	$	15,057	$	—	$	—	$	15,057	$	8,766	$	—	$	—	$	8,766
Cash equivalents		13,008		—		—		13,008		75,636		—		—		75,636
U.S. Treasury securities and agency bonds		16,771		11		19		16,763		9,685		4		58		9,631
Corporate bonds		23,361		56		10		23,407		6,428		32		48		6,412
Mortgage-backed and asset-backed securities*		7,308		364		61		7,611		9,281		271		45		9,507
Mutual funds		—		—		—		—		17,611		—		—		17,611
Closed-end bond funds		26,401		5,161		1,649		29,913		29,255		5,561		1,186		33,630
Preferred stock		6,209		1,878		—		8,087		6,209		649		—		6,858

	$	108,115	$	7,470	$	1,739	$	113,846	$	162,871	$	6,517	$	1,337	$	168,051

Reported as:
Cash and cash equivalents							$	28,065							$	84,402
Short-term investments available-for-sale								85,781								83,649

							$	113,846							$	168,051

*	At March 31, 2012 and 2011, approximately $4.6 million and $6.5 million of the estimated fair value presented were mortgage-backed securities, respectively.

The established guidelines for measuring fair value and expanded disclosures regarding fair value measurements are defined as a three-level valuation hierarchy for disclosure of fair value measurements as follows:



Level 1 —		Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.

Level 2 —		Inputs (other than quoted market prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument's anticipated life.

Level 3 —		Inputs reflect management's best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. Valuation of instruments includes unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of assets or liabilities.

The following is a summary of cash, cash equivalents and available-for-sale investments by type of instruments measured at fair value on a recurring basis (in thousands):


	March 31, 2012								March 31, 2011
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Cash	$	15,057	$	—	$	—	$	15,057	$	8,766	$	—	$	—	$	8,766
Cash equivalents		10,510		2,498		—		13,008		75,636		—		—		75,636
U.S. Treasury securities and agency bonds		16,763		—		—		16,763		9,631		—		—		9,631
Corporate bonds		—		23,407		—		23,407		—		6,412		—		6,412
Mortgage-backed and asset-backed securities		—		7,611		—		7,611		—		9,507		—		9,507
Mutual funds		—		—		—		—		17,611		—		—		17,611
Closed-end bond funds		29,913		—		—		29,913		33,630		—		—		33,630
Preferred stock		—		8,087		—		8,087		—		6,858		—		6,858

	$	72,243	$	41,603	$	—	$	113,846	$	145,274	$	22,777	$	—	$	168,051

There were no significant transfers in and out of Level 1 and Level 2 fair value measurements during the fiscal year ended March 31, 2012.

The Company periodically reviews its strategic investments for other-than-temporary declines in fair value based on the specific identification method and writes down investments when an other-than-temporary decline has occurred. During the fiscal years ended March 31, 2012 and March 31, 2010, the Company recognized impairment charges of its non-marketable strategic investments of $1.0 and $2.0 million, respectively, in other income (expense), net. The fair value was estimated on a non-recurring basis based on Level 3 inputs. The Level 3 inputs used to estimate the fair value of this investment was based on the current cash position and recent operational performance of the investee. During the fiscal year ended March 31, 2012 and 2011, the Company invested $4.8 million and $0.3 million in non-marketable equity investments and this amount was carried at cost at year end, respectively.

At March 31, 2012, the cost and estimated fair values of available-for-sale securities with stated maturities are U.S. Treasury securities and agency bonds, corporate bonds and mortgage-backed and asset-backed securities by contractual maturity are as follows (in thousands):


	Cost		Fair Value
Less than 1 year	$	16,683	$	16,722
Mature in 1 – 2 years		26,869		27,026
Mature in 3 – 5 years		2,421		2,496
Mature after 5 years		1,467		1,537

	$	47,440	$	47,781

The following is a summary of gross unrealized losses (in thousands):


	Less Than 12 Months of Unrealized Losses				12 Months or More of Unrealized Losses				Total
As of March 31, 2012	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
U.S. Treasury securities and agency bonds	$	8,938	$	19	$	—	$	—	$	8,938	$	19
Corporate bonds		5,463		10		—		—		5,463		10
Mortgage-backed and asset-backed securities		894		20		353		42		1,247		62
Closed-end bond funds		—		—		6,628		1,648		6,628		1,648

	$	15,295	$	49	$	6,981	$	1,690	$	22,276	$	1,739


	Less Than 12 Months of Unrealized Losses				12 Months or More of Unrealized Losses				Total
As of March 31, 2011	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
U.S. Treasury securities and agency bonds	$	6,227	$	58	$	—	$	—	$	6,227	$	58
Corporate bonds		3,672		48		—		—		3,672		48
Mortgage-backed and asset-backed securities		2,105		45		—		—		2,105		45
Closed-end bond funds		7,951		1,186		—		—		7,951		1,186

	$	19,955	$	1,337	$	—	$	—	$	19,955	$	1,337

Other-Than-Temporary Impairment

Based on an evaluation of securities that have been in a loss position, the Company did not recognize an other-than-temporary impairment charge, for the fiscal year ended March 31, 2012. The Company considered various factors which included its intent and ability to hold the underlying securities until its estimated recovery of amortized cost. The other-than-temporary impairment charge for the fiscal years ended March 31, 2012, 2011 and 2010 was zero, zero and approximately $4.1 million, respectively. As of March 31, 2012 and 2011, the Company also had $7.5 million and $6.5 million in gross unrealized gains, respectively. The basis for computing realized gains or losses is by specific identification.