4. Fair Value

Financial assets and liabilities, measured at fair value on a recurring basis by level within the fair value hierarchy, consisted of the following (in millions):

	March 31,						June 30,
	2016						2015
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Assets:
Money market funds	$	313.3	$	-	$	-	$	376.3	$	-	$	-
Auction rate securities		-		-		14.1		-		-		15.8
Total available-for-sale securities	$	313.3	$	-	$	14.1	$	376.3	$	-	$	15.8
Liabilities:
Contingent consideration liabilities recorded for business combinations	$	-	$	-	$	25.5	$	-	$	-	$	44.2
Foreign currency contract liabilities	$	-	$	-	$	-	$	-	$	1.3	$	-

In our condensed consolidated balance sheets as of March 31, 2016 and June 30, 2015, money market balances were included in cash and cash equivalents, and auction rate securities, or ARS investments, were included in non-current other assets except $600,000 of the ARS investments were included in prepaid expenses and other current assets as of June 30, 2015.

The contingent consideration liability recorded for business combinations was included in other long-term liabilities as of March 31, 2016 and acquisition-related liabilities as of June 30, 2015, respectively.

We measure our foreign currency contracts at fair value on a recurring basis. We utilized Level 2 inputs to value the foreign currency forward contracts. Specifically, we utilized quoted prices for similar assets and liabilities in markets that are not active. Key inputs for the foreign currency forward contracts are spot rates and yield curves for the respective currencies. There were no outstanding foreign currency contracts as of March 31, 2016. The foreign currency contracts were included in other accrued liabilities as of June 30, 2015.

Changes in fair value of our Level 3 financial assets as of March 31, 2016 were as follows (in millions):

Balance as of June 30, 2015	$	15.8
Net loss		(1.1	)
Redemptions		(0.6	)
Balance as of March 31, 2016	$	14.1

Changes in fair value of our Level 3 contingent consideration liabilities as of March 31, 2016 were as follows (in millions):

Balance as of June 30, 2015	$	44.2
Cash settlement of contingent consideration liability		(18.2	)
Accretion and remeasurement		(0.5	)
Balance as of March 31, 2016	$	25.5

In connection with our acquisition of Validity Sensors, Inc., or Validity, we entered into a contingent consideration arrangement. As of March 31, 2016, the balance represents amounts we have not paid and have retained, subject to resolution of the Amkor Technology legal dispute (see Legal Proceedings under Note 9).

In connection with our acquisition of Pacinian Corporation, or Pacinian, we entered into a contingent consideration arrangement. As of March 31, 2016, we may be required to make additional cash payments of up to $10.0 million as consideration to the former Pacinian stockholders based on unit sales of products utilizing ThinTouch technology through June 2016.

Changes in the fair value of our contingent consideration liabilities subsequent to the Validity and Pacinian acquisitions are included in operating expenses as change in contingent consideration in the condensed consolidated statements of income. Cash payments of contingent consideration are classified in the condensed consolidated statements of cash flows as a financing activity up to the amount of the contingent consideration recorded at the time of the acquisition, and as an operating activity for cash payments that exceed the liability recorded at the time of acquisition.

There were no transfers in or out of our Level 1, 2, or 3 assets or liabilities during the three and nine months ended March 31, 2016 and 2015.

The fair values of our accounts receivable and accounts payable approximate their carrying values because of the short-term nature of those instruments. Intangible assets, property and equipment, and goodwill are measured at fair value on a non-recurring basis if impairment is indicated. The interest rate on our bank debt is variable, which is subject to change from time to time to reflect a market interest rate; accordingly, the carrying value of our bank debt approximates fair value.