Fair Value Measurements

3 Months Ended

Sep. 29, 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 are 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 and assets classified as held for sale.

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

	As of September 29, 2012								As of June 30, 2012
	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)	$	417,569	$	—	$	—	$	417,569	$	602,462	$	—	$	—	$	602,462
Certificates of deposit (1)	—		6,185		—		6,185		—		6,182		—		6,182
Government agency securities (2)	—		75,283		—		75,283		—		75,326		—		75,326
Foreign currency forward contracts (3)	—		1,007		—		1,007		—		642		—		642
Total Assets	$	417,569	$	82,475	$	—	$	500,044	$	602,462	$	82,150	$	—	$	684,612
Liabilities
Foreign currency forward contracts (4)	$	—	$	273	$	—	$	273	$	—	$	507	$	—	$	507
Contingent Consideration (4)	—		—		18,409		18,409		—		—		17,737		17,737
Total Liabilities	$	—	$	273	$	18,409	$	18,682	$	—	$	507	$	17,737	$	18,244

(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 accompanying Condensed Consolidated Balance Sheets.

(4) Included in Accrued expenses in the accompanying 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 three months ended September 29, 2012 and for the year ended June 30, 2012:

Fair Value Measured and Recorded Using Significant Unobservable Inputs (Level 3)
	September 29, 2012		June 30, 2012
Contingent Consideration	(in thousands)
Beginning balance	$	17,737	$	8,800
Total gains or losses (realized and unrealized):
Included in earnings	672		1,670
Additions	—		11,354
Payments	—		(4,087		)
Ending balance	$	18,409	$	17,737
Changes in unrealized gains or losses included in earnings related to liabilities still held as of period end	$	672	$	1,670

The valuation of contingent consideration is based on a probability weighted earnouts model which relies 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 quarterly by management based on inputs received from the Company's engineering and finance personnel. 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 Other operating expenses (income), net. 

During the three months ended September 29, 2012 and the year ended June 30, 2012, 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 September 29, 2012, long-lived assets held for sale were written down to their fair value, less cost to sell of $3.9 million, resulting in an impairment loss of $2.7 million, which was included in earnings for the period. The impairment charge was measured using Level 3 inputs. The Company reached its conclusion regarding the asset impairment after conducting an evaluation of assets fair values. The fair value of the land and buildings was determined mainly after consideration of evidence such as comparable property listings, recent sales, and offers received. Please refer to Note 15: "Impairment of long-lived assets" of these Notes to Condensed Consolidated Financial Statements.

As of June 30, 2012, long-lived assets held for sale were written down to their fair value, less cost to sell of $19.7 million, resulting in an impairment loss of $22.4 million, which was included in earnings for the period. The impairment charge was measured using Level 3 inputs. The Company reached its conclusion regarding the asset impairment after conducting an evaluation of assets fair values. The fair value of the land and buildings was determined mainly after consideration of evidence such as appraisals and offers received. Please refer to Note 15: "Impairment of long-lived assets" of these Notes to Condensed Consolidated Financial Statements.