FAIR VALUE

12 Months Ended

Mar. 30, 2013

FAIR VALUE [Abstract]

FAIR VALUE

2.Fair Value

The Company measures its cash equivalents, short-term investments and long-term investments at fair value.Fair value is defined as the price that would be received from selling an asset and paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance.

A three-tiered fair value hierarchy is established as basis for considering the above assumptions and determining the inputs used in the valuation methodologies in measuring fair values.  The three levels of inputs are defined as follows:

Level 1 – Unadjusted quoted market prices for identical assets or liabilities in active markets that the Company has the ability to access.

Level 2 – Observable inputs such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets.

Level 3 - Valuations based on models where significant inputs are not observable. The unobservable inputs reflect the Company’s own assumptions about the assumptions that market participants would use.

The Company maximizes the use of observable inputs and minimizes the use of unobservable inputs. If a financial instrument uses input that is significant to the fair value calculation, the instrument will be categorized based upon the lowest level of input that is significant to the fair value calculation.  The Company’s financial assets and liabilities measured at fair value on a recurring basis include cash equivalents and investment securities, both short-term and long-term.

The carrying value of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair value due to their short maturities.

The Company’s money market investments, certificates of deposit purchased directly from the bank, and Non Qualified Deferred Compensation (NQDCP) assets and liabilities are valued using Level 1 inputs. Fixed income available-for-sale portfolio mainly consisting of municipal bonds, US government agency bonds, corporate bonds, commercial papers and certificates of deposit bought in the secondary market are valued using Level 2 inputs.

Included in the Company’s long-term investments are ARS, which are collateralized by student loans. Due to the lack of availability of observable market quotes for the Company’s investment portfolio of these ARS, the fair value was estimated based on a discounted cash flow model using Level 3 inputs. The assumptions used in the discounted cash flow model include estimates for interest rates, timing and amounts of cash flows, liquidity of the underlying security, expected holding periods and contractual terms of the security.

In light of the current market condition for ARS, the Company developed different scenarios for the significant inputs used in the discounted cash flow model, including, but not limited to liquidity discount for the current ARS market, and the timing of recovery of ARS market from three to six years. The Company used a term of four years; current coupon rate range of .2%-.3%; discount margin range of 1.55%-2.05%; and illiquidity discount range of 3.04%- 5.05%. The Company believes these estimated ranges of inputs used for computing fair values of its ARS are appropriate taking into consideration historical ARS market data, the possibility of development of a secondary market for ARS, recent market participant behaviors, and public policy implications associated with the student loan based ARS market. The Company concluded that the fair value of its ARS was $13,800,000, or 92% of par value, as ofMarch 30, 2013 and recorded a temporary impairment of  $1,250,000 as a component of other comprehensive loss.

The Company also considered the quality, amount of collateral, and US government guarantee for a portion of the ARS and looked to other marketplace transactions and information received from other third party brokers in order to assess whether the fair value based on the discounted cash flow model was reasonable. The valuation of the Company’s investment portfolio is subject to uncertainties that are difficult to predict. Factors that may affect the Company’s valuation include changes to credit ratings of the securities as well as the underlying assets supporting those securities, rates of default of the underlying assets, underlying collateral values, discount rates, counterparty risk and ongoing strength and quality of market credit and liquidity. Significant inputs to the investment valuations are unobservable in the active markets and therefore the Company’s ARS are classified as Level 3 in the hierarchy.

The sensitivity to changes in the unobservable inputs and their impact on the fair value can be significant. The significant unobservable inputs for ARS are illiquidity, term and coupon forecast assumptions. The illiquidity and termassumptionsare negatively correlated to the fair value. An increase/decrease in the determined illiquidity or termassumption will lower/increase the fair value. The coupon forecast is positively correlated to the fair value. An increase/decrease in the determined coupon forecast will increase/decrease the fair value. A permutation that includes a change in the coupon forecast with a change in either or both of the two variables will mitigate the significance of the change to the fair value.

The following tables summarize assets and liabilities measured at fair value as of March 30, 2013 and March 31, 2012, excluding accrued interest (in thousands):^_

	March 30, 2013
	Fair value measurements
Assets	Level 1			Level 2		Level 3		Total
Money market funds	$	13,476	(1)	$	-	$	-	$	13,476
Municipal bonds		-			58,658		-		58,658
Corporate bonds		-			25,825		-		25,825
Government agency bonds		-			16,187		-		16,187
Certificate of deposits		3,459			4,300		-		7,759
Commercial Papers					5,745				5,745
Equity mutual funds related to NQDCP		9,673			-		-		9,673
Long-term investments in ARS		-			-		13,800		13,800
Total assets at fair value	$	26,608		$	110,715	$	13,800	$	151,123
Liabilities
Obligation related to NQDCP	$	9,673		$	-	$	-	$	9,673

	March 31, 2012
	Fair value measurements
Assets	Level 1			Level 2		Level 3		Total
Money market funds	$	16,453	(1)	$	-	$	-	$	16,453
Municipal bonds		-			32,268		-		32,268
Corporate bonds		-			36,947		-		36,947
Government agency bonds		-			26,010		-		26,010
Certificate of deposits		3,000			4,262		-		7,262
Equity mutual funds related to NQDCP		8,650			-		-		8,650
Long-term investments in ARS		-			-		25,900		25,900
Total assets at fair value	$	28,103		$	99,487	$	25,900	$	153,490
Liabilities
Obligation related to NQDCP	$	8,650		$	-	$	-	$	8,650

^{____________________}

⁽¹⁾Money market funds of $13,476,000 and  $16,453,000were classified as cash equivalents as of March 30, 2013 and March 31, 2012.

There were no significant transfers between Level 1, Level 2 andLevel 3 during fiscal year 2013. The following table summarizes the change in fair value of the Company’s level 3 assets during the fiscal year ended March 30, 2013(in thousands):

Fair value measurements of assets using level 3 inputs		Long-term investments in ARS
Balance as of April 3, 2010	$	65,000
Redemption of investments in ARS at par		(36,450)
Reversals of unrealized losses due to redemptions		2,222
Change in fair value of existing ARS		(572)
Balance as of April 2, 2011		30,200
Redemption of investments in ARS at par		(4,700)
Reversals of unrealized losses due to redemptions		388
Change in fair value of existing ARS		12
Balance as of March 31, 2012		25,900
Redemption of investments in ARS at par		(13,000)
Reversals of unrealized losses due to redemptions		1,023
Change in fair value of existing ARS		(123)
Balance as of March 30, 2013	$	13,800

The Company recognizes transfers into and out of levels within the fair value hierarchy based on the transaction or the change in circumstances at the end of the fiscal month.

During the fiscal year ended March 30, 2013, the Company received $13,000,000 relating to ARS redeemed at par value.

Subsequent to March 30, 2013, the Company received two ARS redemptions at par value totaling  $12,950,000.