Fair Value Measurements

9 Months Ended

Mar. 31, 2012

Fair Value Disclosures [Abstract]

Fair Value Measurements [Text Block]

FAIR VALUE MEASUREMENTS

The FASB established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Three levels of inputs that may be used to measure fair value as follows:

Level 1 - Quoted (unadjusted) prices in active markets for identical assets or liabilities.

The Company's Level 1 assets consist of money market funds.

Level 2 - Observable inputs other than quoted prices included in Level 1, 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, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability.

The Company's Level 2 assets and liabilities consist of certificates of deposit, government agency securities and foreign currency forward contracts.

Level 3 - Unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The Company's Level 3 liabilities consist of contingent consideration related to certain acquisitions. For details on inputs used in measuring fair value, please refer to Note 13: Acquisitions to the Condensed Consolidated Financial Statements.

Assets and liabilities measured at fair value on a recurring basis were as follows:

	As of March 31, 2012								As of June 25, 2011
	Fair Value								Fair Value
	Measurements Using						Total		Measurements Using						Total
	Level 1		Level 2		Level 3		Balance		Level 1		Level 2		Level 3		Balance
	(in thousands)
Assets
Money market funds (1)	$	627,671	$	—	$	—	$	627,671	$	603,180	$	—	$	—	$	603,180
Certificates of deposit (1)	—		6,179		—		6,179		—		3,457		—		3,457
Government agency securities (2)	—		75,405		—		75,405		—		50,346		—		50,346
Foreign currency forward contracts (3)	—		430		—		430		—		326		—		326
Total Assets	$	627,671	$	82,014	$	—	$	709,685	$	603,180	$	54,129	$	—	$	657,309
Liabilities
Foreign currency forward contracts (4)	$	—	$	291	$	—	$	291	$	—	$	309	$	—	$	309
Contingent Consideration (4)	—		—		18,324		18,324		—		—		8,800		8,800
Total Liabilities	$	—	$	291	$	18,324	$	18,615	$	—	$	309	$	8,800	$	9,109

(1) Included in Cash and cash equivalents in the accompanying Condensed Consolidated Balance Sheets.

(2) Included in Short-term investments in the accompanying Condensed Consolidated Balance Sheets.

(3) Included in Other current assets in the Condensed Consolidated Balance Sheets.

(4) Included in Accrued expenses in the Condensed Consolidated Balance Sheets.

The tables below present reconciliations for liabilities measured and recorded at fair value on a recurring basis using significant unobservable inputs (Level 3) for the nine months ended March 31, 2012 and for the twelve months ended June 25, 2011:

Fair Value Measured and Recorded Using Significant Unobservable Inputs (Level 3)
	March 31, 2012			June 25, 2011
Contingent Consideration	(in thousands)
Beginning balance	$	8,800		$	—
Additions	11,354			8,800
Payments	(1,830		)	—
Ending balance	$	18,324		$	8,800
Changes in unrealized gains or losses included in earnings related to liabilities still held as of period end	$	—		$	—

The valuation of contingent consideration was based on a probability weighted earnouts model which relied primarily on estimates of milestone achievements and discount rates applicable for the period expected payout. The most significant unobservable input used in the determination of estimated fair value of contingent consideration is the estimates on the likelihood of milestone achievements, which directly correlates to the fair value recognized in the Condensed Consolidated Balance Sheets. .

The fair value of this liability is estimated on a quarterly basis by Management using a collaborative effort of the Company's engineering and accounting departments. The determination of the milestone achievement is performed by the Company's engineering department and reviewed by the accounting department. Potential valuation adjustments are made as the progress toward achieving milestones becomes determinable with the impact of such adjustments being recorded through interest and other expense, net. 

As of March 31, 2012 and June 25, 2011, there were no transfers in or out of level 3 from other levels in the fair value hierarchy.

Assets measured at fair value on a non-recurring basis were as follows:

As of March 31, 2012, long-lived assets held for sale with a carrying amount of $11.3 million were written down to their fair value, less cost to sell of $3.6 million, resulting in an impairment loss of $7.7 million, which was included in earnings for the period. The impairment charge was measured using level 3 inputs. The fair value of the equipment was determined mainly after consideration of quoted market prices of similar equipment adjusted for equipment specifications and condition in addition to the current market demand and size. Please refer to Note 15: Impairment of long-lived assets to the Condensed Consolidated Financial Statements.

As of June 25, 2011, none of the Company's assets and liabilities were measured at fair value on a non-recurring basis.