Fair Value Measurements

6 Months Ended

Sep. 29, 2012

Fair Value Measurements

5. Fair Value Measurements

Financial Assets Measured at Fair Value

ASC Topic 820 establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include the following:

• Level 1, defined as observable inputs such as quoted prices in active markets for identical assets or liabilities;

• Level 2, defined as inputs that are observable either directly or indirectly such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and other inputs that can be corroborated by observable market data; and

• Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The Company’s fair value hierarchy for its financial assets measured at fair value on a recurring basis as of September 29, 2012 and March 31, 2012 was as follows (in thousands):

September 29, 2012	Level 1		Level 2			Level 3		Total
Money market securities	$	12,761	$	—		$	—	$	12,761
Government agencies		—		83,056			—		83,056
Commercial paper		—		30,346			—		30,346
Corporate bonds		—		22,797			—		22,797
Forward purchase or (sale) contracts:
Japanese Yen		—		(87	)		—		(87	)
Taiwan Dollar		—		15			—		15
Korean Won		—		40			—		40
Euro		—		(90	)		—		(90	)
British Pound		—		63			—		63
Singapore Dollar		—		15			—		15
March 31, 2012	Level 1		Level 2			Level 3		Total
Money market securities	$	5,244	$	—		$	—	$	5,244
Commercial paper		—		83,645			—		83,645
Government agencies		—		67,261			—		67,261
Corporate Bonds		—		20,121			—		20,121
Forward purchase or (sale) contracts:
Japanese Yen		—		202			—		202
Taiwan Dollar		—		(5	)		—		(5	)
Korean Won		—		(17	)		—		(17	)
Euro		—		(1	)		—		(1	)
British Pound		—		20			—		20
Chinese Renminbi		—		(1	)		—		(1	)

For Level 1 assets, the Company utilized quoted prices in active markets for identical assets.

For Level 2 assets, exclusive of forward contracts, the Company utilized quoted prices in active markets for similar assets. For forward contracts, spot prices at September 28, 2012 and March 30, 2012 were utilized to calculate unrealized gain/loss.

During the second quarter of 2013, there were no transfers between Level 1 and Level 2 assets. As of September 29, 2012, the Company did not hold any auction rate securities (ARS) investments. In the first quarter of 2012, the Company sold all of its remaining ARS for approximately $6.0 million and all of its related preferred stock for approximately $0.5 million. These ARS had a total estimated fair value of $5.2 million as of April 2, 2011, which consisted of $10.7 million par value ARS and $4.0 million par value ARS which were converted by the bond issuer to its preferred stock in 2009. The Company recorded a gain of $2.7 million in the first quarter of 2012, which included $1.4 million in reclassification of previously recorded unrealized gain out of accumulated other comprehensive income.

As of September 29, 2012, the Company had $6.0 million invested in Series D Preferred Stock and $3.0 million invested in Series E Preferred Stock of OmniGuide, Inc., representing an 11% interest. At each reporting period end, the Company determines whether events or circumstances have occurred that are likely to have a significant adverse effect on the fair value of these investments. If there are no events or circumstances identified that would adversely affect the fair value of the investments, the fair values of the investments are not calculated as it is not practicable to do so. As of September 29, 2012 and March 31, 2012, management had not identified events or circumstances that indicated the investments were impaired; therefore, as presented in Note 8 “Other Assets”, the full carrying value of $9.0 million was included in Other assets on the Consolidated Balance Sheets at September 29, 2012 and March 31, 2012.

Investments

Certain information regarding the Company’s investments at September 29, 2012 and March 31, 2012 was as follows (in thousands):

September 29, 2012			Unrealized
	Cost		Gain		Loss			Fair Value
Available-for-sale securities (current):
Government agencies	$	72,539	$	9	$	—		$	72,548
Commercial paper		30,345		1		—			30,346
Corporate bonds		22,763		34		—			22,797
	$	125,647	$	44	$	—		$	125,691
Available-for-sale securities (non-current):
Government agencies		10,499		9		—			10,508
	$	10,499	$	9	$	—		$	10,508
March 31, 2012			Unrealized
	Cost		Gain		Loss			Fair Value
Available-for-sale securities (current):
Commercial paper	$	83,645	$	—	$	—		$	83,645
Government agencies		46,293		5		—			46,298
Corporate Bonds		17,987		51		—			18,038
	$	147,925	$	56	$	—		$	147,981
Available-for-sale securities (non-current):
Government agencies	$	20,989	$	—	$	(26	)	$	20,963
Corporate Bonds		2,070		13		—			2,083
	$	23,059	$	13	$	(26	)	$	23,046

For purposes of determining gross realized gains and losses, and reclassification out of accumulated other comprehensive income, the cost of securities sold is based on specific identification. Net unrealized holding gains and losses on current available-for-sale securities included in accumulated other comprehensive income were insignificant as of September 29, 2012 and March 31, 2012.

Underlying maturities of investments at September 29, 2012 were $125.7 million within one year and $10.5 million between one to five years.