Investments

12 Months Ended

Mar. 31, 2011

Notes to Financial Statements [Abstract]

5.	INVESTMENTS

The Company's investments are intended to establish a high-quality portfolio that preserves principal, meets liquidity needs, avoids inappropriate concentrations, and delivers an appropriate yield in relationship to the Company's investment guidelines and market conditions. The following is a summary of available-for-sale securities at March 31, 2011 (amounts in thousands):

	Available-for-sale Securities
	Adjusted Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Government agency bonds	$	431,355	$	159	$	(923	)	$	430,591
Municipal bonds		11,445		34		(22	)		11,457
Auction rate securities		12,475		---		---			12,475
Corporate bonds and debt		519,499		4,116		(589	)		523,026
Marketable equity securities		26,173		688		---			26,861
	$	1,000,947	$	4,997	$	(1,534	)	$	1,004,410

The following is a summary of available-for-sale and trading securities at March 31, 2010 (amounts in thousands):

	Available-for-sale Securities
	Adjusted Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Government agency bonds	$	389,801	$	215	$	(622	)	$	389,394
Municipal bonds		156,415		1,290		---			157,705
Auction rate securities		14,151		---		---			14,151
Marketable equity securities		58,402		---		---			58,402
Corporate bonds		392,108		2,983		(235	)		394,856
	$	1,010,877	$	4,488	$	(857	)	$	1,014,508

	Trading Securities
	Adjusted Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
ARS	$	23,086	$	---	$	---	$	23,086
Put option on ARS		1,814		---		---		1,814
	$	24,900	$	---	$	---	$	24,900

At March 31, 2011, the Company's available-for-sale debt securities, and marketable equity securities are presented on the condensed consolidated balance sheets as short-term investments of $539.6 million and long-term investments of $464.8 million. At March 31, 2010, the Company’s available-for-sale debt securities, marketable equity securities and trading securities are presented on the condensed consolidated balance sheets as short-term investments of $722.2 million and long-term investments of $317.2 million.

As of March 31, 2010, the Company had investments in student loan-backed auction rate securities (ARS) with a fair value of $23.1 million. In November 2008, the Company executed an ARS rights agreement (the Rights) with the broker through which the Company purchased the student-loan ARS that provided (i) the Company with the right to put these ARS back to the broker at par anytime during the period from June 30, 2010 through July 2, 2012, and (ii) the broker with the right to purchase or sell the ARS at par on the Company’s behalf anytime through July 2, 2012. The Company accounted for the acceptance of the Rights as the receipt of a put option for no consideration and recognized a gain with a corresponding recognition as a long-term investment. During the period from April 1, 2010 to June 30, 2010, $17.8 million of the student-loan auction rate securities were redeemed by the original issuers. The Company exercised its Rights to sell the remaining $7.1 million in ARS at par to the broker on June 30, 2010 and received full cash settlement for the transaction on July 1, 2010.

At March 31, 2011, $12.5 million of the fair value of the Company's investment portfolio was invested in ARS. With the continuing liquidity issues in the global credit and capital markets, the Company's ARS have experienced multiple failed auctions from September 2007 through the date of this report. While the Company continues to earn interest on these investments based on a pre-determined formula with spreads tied to particular interest rate indices, the estimated market value for these ARS no longer approximates the original purchase value.

The fair value of the failed ARS of $12.5 million has been estimated based on market information and estimates determined by management and could change significantly based on market conditions. The Company evaluated the impairments in the value of these ARS, determining its intent to sell these securities prior to the recovery of its amortized cost basis resulted in the securities being other-than-temporarily impaired and has recognized impairment charges on these investments of $1.6 million in fiscal 2011 and $4.7 million in fiscal 2010.

The Company believes that, based on its current unrestricted cash, cash equivalents and short-term investment balances, the current lack of liquidity in the credit and capital markets for ARS will not have a material impact on its liquidity, cash flow or ability to fund its operations.

At March 31, 2011, the Company evaluated its investment portfolio and noted unrealized losses of $1.5 million on its debt securities, which were due to fluctuations in interest rates and credit market conditions. Management does not believe any of the unrealized losses represent other-than-temporary impairment based on its evaluation of available evidence as of March 31, 2011, except for the ARS described above. The Company's intent is to hold these investments, other than the ARS described above, until these assets are no longer impaired. For those investments not scheduled to mature until after March 31, 2012, such recovery is not anticipated to occur in the next year and these investments have been classified as long-term investments.

The amortized cost and estimated fair value of the available-for-sale securities at March 31, 2011, by maturity, excluding marketable equity securities of $26.9 million and corporate debt of $3.5 million, which have no contractual maturity, are shown below (amounts in thousands). Expected maturities can differ from contractual maturities because the issuers of the securities may have the right to prepay obligations without prepayment penalties, and the Company views its available-for-sale securities as available for current operations.

	Adjusted Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Available-for-sale
Due in one year or less	$	143,447	$	903	$	(2	)	$	144,348
Due after one year and through five years		815,352		3,406		(1,532	)		817,226
Due after five years and through ten years		---		---		---			---
Due after ten years		12,475		---		---			12,475
	$	971,274	$	4,309	$	(1,534	)	$	974,049

The following is a summary of available-for-sale securities at March 31, 2010 (amounts in thousands):

	Adjusted Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Available-for-sale
Due in one year or less	$	308,020	$	1,743	$	(19	)	$	309,744
Due after one year and through five years		688,706		2,745		(838	)		690,613
Due after five years and through ten years		---		---		---			---
Due after ten years		14,151		---		---			14,151
	$	1,010,877	$	4,488	$	(857	)	$	1,014,508

During the year ended March 31, 2011, the Company had an immaterial amount of net realized gains and losses from sales of available-for-sale securities compared to net realized gains on sales of available-for-sale securities of $1.2 million and $0.5 million during the years ended March 31, 2010 and March 31, 2009, respectively.

Marketable Equity Investments

The Company acquired investments in public companies as part of the SST acquisition valued at $47.1 million at the time of acquisition. These public companies are listed on the Taiwan Stock Exchange and include: King Yuan Electronics Company Limited (KYE); Insyde Software Corporation (Insyde); Powertech Technology, Incorporated (PTI); and Professional Computer Technology, Ltd. (PCT). During the quarter ended December 31, 2010, Apacer Technology, Inc. (Apacer) completed an initial public offering on the Taiwan Stock Exchange and is now publicly traded. The Company reclassified this investment out of non-marketable equity investments to marketable equity investments resulting in an increase in the fair value of the marketable equity investments of $9.0 million as of December 31, 2010.

As of March 31, 2011, approximately $16.6 million and $10.3 million of these marketable investments have been included in short-term and long-term available-for-sale investments, respectively, based upon management's intent to hold such securities until recovery. Cash dividends and other distributions of earnings from the investees, if any, are included in other income at the date of record. The Company has classified the shares owned in these companies as marketable securities. As of March 31, 2011, the Company had an unrealized gain in other comprehensive income of $0.7 million on these marketable securities, which the Company has determined to be a temporary impairment.

Non-marketable Equity Investments

The Company has certain investments in privately held companies with a carrying value of $7.7 million at March 31, 2011. As part of the acquisition of SST, the Company acquired certain investments in privately held companies with an estimated fair value at the date of the acquisition of $18.1 million. These investments had a carrying value of $5.6 million at March 31, 2011 as a result of sales of investments of $4.4 million and a reclassification to marketable equity investments of $8.1 million. The investments in privately held companies are accounted for using the cost or the equity method of accounting, as appropriate. Each period the Company evaluates whether an event or change in circumstances has occurred that may indicate an investment has been impaired. If upon further investigation of such events the Company determines the investment has suffered a decline in value that is other than temporary, the Company writes down the investment to its estimated fair value. At March 31, 2011, the Company determined there were no such impairments. These investments are included in other assets on the Company's consolidated balance sheet.