Fair Value Measurements

3 Months Ended

Jun. 30, 2011

Fair Value Measurements

Fair Value Measurements

12. Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or would be paid to transfer a liability in an orderly transaction between market participants on the measurement date. The fair value of financial assets and liabilities are measured on a recurring or non-recurring basis. Financial assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. Financial assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when a significant event occurs. In determining fair value of financial assets and liabilities, the Company uses various valuation techniques. For many financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment. The availability of pricing inputs observable in the market varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded, and other characteristics particular to the transaction.

The Company estimates the fair value of financial instruments using available market information and generally accepted valuation methodologies. The Company assesses the inputs used to measure fair value using a three-tier hierarchy. The hierarchy indicates the extent to which pricing inputs used in measuring fair value are observable in the market. Level 1 inputs include unadjusted quoted prices for identical assets or liabilities and are the most observable. Level 2 inputs include unadjusted quoted prices for similar assets and liabilities that are either directly or indirectly observable, or other observable inputs such as interest rates, foreign currency exchange rates, commodity rates, and yield curves. Level 3 inputs are not observable in the market and include the Company's own judgments about the assumptions market participants would use in pricing the asset or liability. The use of observable and unobservable inputs is reflected in the hierarchy assessment disclosed in the tables below.

Additional information with respect to the Company's fair value measurements is included in the Company's Annual Report on Form 10-K for the year ended March 31, 2011.

There were no transfers between Levels 1, 2, and 3 during the three months ended June 30, 2011 and 2010.

The following tables present information about the Company's financial assets and liabilities measured at fair value on a recurring basis and indicate the fair value hierarchy of the valuation techniques utilized to determine such fair value:

	Fair value measurement used
	Recorded value as of June 30, 2011		Active markets for  identical assets or liabilities (Level 1)		Quoted prices  in similar instruments and observable inputs (Level 2)		Active markets for  unobservable inputs (Level 3)
Assets:
Available for sale restricted marketable securities — current	$	13,727	$	13,727	$	—	$	—
Corporate-owned life insurance — non-current		3,365		—		—		3,365
Liabilities:
BEP — current	$	5,418	$	—	$	5,418	$	—

	Fair value measurement used
	Recorded value as of March 31, 2011		Active markets for  identical assets or liabilities (Level 1)		Quoted prices  in similar instruments and observable inputs (Level 2)		Active markets for  unobservable inputs (Level 3)
Assets:
Available for sale restricted marketable securities — current	$	5,791	$	5,791	$	—	$	—
Available for sale restricted marketable securities — non-current		7,950		7,950		—		—
Corporate-owned life insurance — non-current		3,323		—		—		3,323
Liabilities:
BEP — non-current	$	5,629	$	—	$	5,629	$	—

The Company maintains an investment in available for sale marketable securities in which cost approximates fair value. The recorded value of the Company's investment in available for sale marketable securities is based on quoted prices in active markets and, therefore, is classified within Level 1 of the fair value hierarchy. As of June 30, 2011, the Company has $9,000 of unrealized losses related to this investment, which is recorded within "Accumulated other comprehensive income (loss)" in the Condensed Consolidated Balance Sheets.

The recorded value of the Corporate-owned life insurance policies is adjusted to the cash surrender value of the policies which are not observable in the market, and therefore, are classified within Level 3 of the fair value hierarchy. Changes in the cash surrender value of these policies are recorded within "Other income, net" in the Condensed Consolidated Statements of Operations. Although corporate-owned life insurance policies are exempt from such disclosure requirements, management believes the disclosures are useful to financial statement users.

The recorded value of the BEP obligation is measured as employee deferral contributions and Company matching contributions less distributions made from the plan, and adjusted for the returns on the hypothetical investments selected by the participants, which are indirectly observable and therefore, classified within Level 2 of the fair value hierarchy.

The following table presents a summary of changes in the fair value of the Level 3 assets and liabilities for the three months ended June 30, 2011 and 2010:

	Three months ended June 30
	2011			2010
Company-owned life insurance:
Balance on April 1	$	3,323		$	16,095
Realized gains		—			2,065
Unrealized losses relating to instruments still held at the reporting date		(4	)		(855	)
Purchases		46			504
Sales		—			—
Issuances		—			—
Settlements		—			(2,017	)
Balance on June 30	$	3,365		$	15,792

Realized gains represent the amounts recognized during the first quarter of fiscal 2011 on the redemption of certain Corporate-owned life insurance policies and are recorded within "Other income, net" in the accompanying Condensed Consolidated Statements of Operations. Unrealized losses related to the Corporate-owned life insurance policies are recorded within "Other income, net" in the accompanying Condensed Consolidated Statements of Operations.

The following tables present information about the Company's financial and nonfinancial assets and liabilities measured at fair value on a nonrecurring basis and indicate the fair value hierarchy of the valuation techniques utilized to determine such fair value:

	Fair value measurement used
	Recorded value as of June 30, 2011		Active markets for identical assets or liabilities (Level 1)		Quoted prices in similar instruments and observable inputs (Level 2)		Active markets for unobservable inputs (Level 3)
Assets:
Goodwill	$	20,556	$	—	$	—	$	20,556
Intangible assets		22,117		—		—		22,117
Liabilities:
SERP obligations — current	$	5,705	$	—	$	—	$	5,705
Other employee benefit plans obligations — current		116		—		—		116
Restructuring liabilties — current		2,057		—		—		2,057
Restructuring liabilties — non-current		1,234		—		—		1,234
Other employee benefit plans obligations — non-current		305		—		—		305
	Fair value measurement used
	Recorded value as of March 31, 2011		Active markets for identical assets or liabilities (Level 1)		Quoted prices in similar instruments and observable inputs (Level 2)		Active markets for unobservable inputs (Level 3)
Assets:
Goodwill	$	20,569	$	—	$	—	$	20,569
Intangible assets		22,535		—		—		22,535
Liabilities:
SERP obligations — current	$	5,675	$	—	$	—	$	5,675
Other employee benefit plans obligations — current		116		—		—		116
Restructuring liabilties — current		1,141		—		—		1,141
Restructuring liabilties — non-current		388		—		—		388
Other employee benefit plans obligations — non-current		305		—		—		305

Goodwill of the Company's reporting units is measured for impairment on an annual basis, or in interim periods if indicators of potential impairment exist, using a combination of an income approach and a market approach.

The Company's intangible assets are valued at their estimated fair value at time of acquisition. The Company evaluates the fair value of its finite-lived intangible assets when impairment indicators are present and its indefinite-lived intangible assets on an annual basis, or in interim periods if indicators of potential impairment exist. The same approach described above for the goodwill valuation is also used to value indefinite-lived intangible assets.

The recorded value of the Company's SERP and other benefit plans obligations is based on estimates developed by management by evaluating actuarial information and includes assumptions such as discount rates, future compensation increases, expected retirement dates, payment forms, and mortality. The recorded value of these obligations is measured on an annual basis, or upon the occurrence of a plan curtailment or settlement.

The Company's restructuring liabilities primarily consist of one-time termination benefits to former employees and ongoing costs related to long-term operating lease obligations. The recorded value of the termination benefits to employees is adjusted to the expected remaining obligation for each period based on the arrangements made with the former employees. The recorded value of the ongoing lease obligations is based on the remaining lease term and payment amount, net of sublease income plus interest, discounted to present value. Changes in subsequent periods resulting from a revision to either the timing or the amount of estimated cash flows over the future period are measured using the credit-adjusted, risk-free rate that was used to measure the restructuring liabilities initially.

The inputs used to value the Company's goodwill, intangible assets, SERP obligations, other employee benefit plans obligations, and restructuring liabilities are not observable in the market and, therefore, these amounts are classified within Level 3 in the fair value hierarchy.

The following table presents a summary of changes in the fair value of the Level 3 assets and liabilities for the three months ended June 30, 2011 and 2010:

	Three months ended June 30, 2011
	Goodwill			Intangible assets			SERP obligations			Other employee benefit plans obligations			Restructuring liabilities
Balance at April 1, 2011	$	20,569		$	22,535		$	5,675		$	421		$	1,529
Realized losses		—			—			—			—			—
Unrealized gains (losses) relating to instruments still held at the reporting date		(13	)		—			—			—			—
Purchases		—			348			30			—			2,395
Sales		—			—			—			—			—
Issuances		—			—			—			—			—
Settlements		—			—			—			—			(633	)
Amortization		—			(766	)		—			—			—
Balance at June 30, 2011	$	20,556		$	22,117		$	5,705		$	421		$	3,291
	Three months ended June 30, 2010
	Goodwil			Intangible assets			SERP obligations			Other employee benefit plans obligations			Restructuring liabilities
Balance at April 1, 2010	$	50,418		$	32,510		$	8,412		$	454		$	1,938
Realized losses		—			—			383			—			—
Unrealized (losses) gains relating to instruments still held at the reporting date		(68	)		—			(57	)		—			—
Purchases		—			964			92			—			393
Sales		—			—			—			—			—
Issuances		—			—			—			—			—
Settlements		—			—			(2,504	)		(35	)		(811	)
Amortization		—			(1,215	)		—			—			—
Balance at June 30, 2010	$	50,350		$	32,259		$	6,326		$	419		$	1,520

Realized losses on the Company's SERP obligation were primarily comprised of the actuarial losses recognized due to the settlement of a SERP obligation to a former executive and are recorded within "Restructuring charges" in the accompanying Condensed Consolidated Statements of Operations. Additional information regarding the Company's restructuring actions is included in Note 5 to Condensed Consolidated Financial Statements.

Unrealized gains related to goodwill represent fluctuations due to the movement of foreign currencies relative to the U.S. dollar. Cumulative currency translation adjustments are recorded within "Other comprehensive income" in the accompanying Condensed Consolidated Balance Sheets. Unrealized losses related to the Company's SERP obligation represent the unamortized actuarial losses, net of taxes, and are recorded within "Other comprehensive income" in the accompanying Condensed Consolidated Balance Sheets.