Fair Value Measurements (Notes)

3 Months Ended

Sep. 30, 2011

Notes to Financial Statements [Abstract]

Fair Value Measurements

Fair Value Measurements

Accounting rules for fair value clarify that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants.  As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability.  As a basis for considering such assumptions, the Company utilizes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

Level 1- Observable inputs such as quoted prices in active markets;

Level 2- Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

Level 3- Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

Marketable Debt Instruments

Marketable debt instruments include instruments such as corporate bonds and debt, government agency bonds, bank deposits, municipal bonds, and money market fund deposits. When the Company uses observable market prices for identical securities that are traded in less active markets, the Company classifies its marketable debt instruments as Level 2. When observable market prices for identical securities are not available, the Company prices its marketable debt instruments using non-binding market consensus prices that are corroborated with observable market data; quoted market prices for similar instruments; or pricing models, such as a discounted cash flow model, with all significant inputs derived from or corroborated with observable market data. Non-binding market consensus prices are based on the proprietary valuation models of pricing providers or brokers. These valuation models incorporate a number of inputs, including non-binding and binding broker quotes; observable market prices for identical or similar securities; and the internal assumptions of pricing providers or brokers that use observable market inputs and, to a lesser degree, unobservable market inputs. The Company corroborates non-binding market consensus prices with observable market data using statistical models when observable market data exists. The discounted cash flow model uses observable market inputs, such as LIBOR-based yield curves, currency spot and forward rates, and credit ratings.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets measured at fair value on a recurring basis at September 30, 2011 are as follows (amounts in thousands):

	Quoted Prices in Active Markets for  Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant  Unobservable Inputs (Level 3)		Total Balance
Assets
Money market fund deposits	$	318,820	$	—	$	—	$	318,820
Marketable equity securities	8,078		—		—		8,078
Corporate bonds & debt	—		718,974		4,625		723,599
Government agency bonds	—		346,342		—		346,342
Deposit accounts	—		356,309		—		356,309
Municipal bonds	—		10,577		—		10,577
Auction Rate Securities	—		—		11,693		11,693
Total assets measured at fair value	$	326,898	$	1,432,202	$	16,318	$	1,775,418

Assets measured at fair value on a recurring basis at March 31, 2011 are as follows (amounts in thousands):

	Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Balance
Assets
Money market fund deposits	$	464,669	$	—	$	—	$	464,669
Marketable equity securities	26,861		—		—		26,861
Corporate bonds & debt	—		519,526		3,500		523,026
Government agency bonds	—		430,591		—		430,591
Deposit accounts	—		239,255		—		239,255
Municipal bonds	—		11,457		—		11,457
Auction Rate Securities	—		—		12,475		12,475
Total assets measured at fair value	$	491,530	$	1,200,829	$	15,975	$	1,708,334

For Level 3 valuations, the Company estimated the fair value of its ARS based on the following: (i) the underlying structure of each security; (ii) the present value of future principal and interest payments discounted at rates considered to reflect current market conditions; (iii) consideration of the probabilities of default, auction failure, or repurchase at par for each period; and (iv) estimates of the recovery rates in the event of default for each security.  The estimated fair values that are categorized as Level 3 as well as the marketable equity securities could change significantly based on future market conditions.

The following tables present a reconciliation for all assets measured at fair value on a recurring basis, excluding accrued interest components, using significant unobservable inputs (Level 3) for the three and six months endedSeptember 30, 2011, and the three and six months endedSeptember 30, 2010 (amounts in thousands):

Three months ended September 30, 2011	Auction Rate Securities			Corporate Debt		Total Gains (Losses)
Balance at June 30, 2011	$	12,088		$	3,500	$	—
Total gains or losses (realized and unrealized):
Included in earnings	(395		)	—		(395		)
Included in other comprehensive income (loss)	—			—		—
Purchases, sales, issuances, and settlements, net	—			787		—
Transfer into Level 3	—			338		—
Transfer out of Level 3	—			—		—
Balance at September 30, 2011	$	11,693		$	4,625	$	(395	)

Six months ended September 30, 2011	Auction Rate  Securities			Corporate Debt		Total Gains (Losses)
Balance at March 31, 2011	$	12,475		$	3,500	$	—
Total gains or losses (realized and unrealized):
Included in earnings	(782		)	—		(782		)
Included in other comprehensive income (loss)	—			—		—
Purchases, sales, issuances, and settlements, net	—			787		—
Transfer into Level 3	—			338		—
Transfer out of Level 3	—			—		—
Balance at September 30, 2011	$	11,693		$	4,625	$	(782	)

Three months ended September 30, 2010	Auction Rate Securities			Put Option on Auction Rate Securities			Corporate Debt		Total Gains (Losses)
Balance at June 30, 2010	$	20,396		$	453		$	3,500	$	—
Total gains or losses (realized and unrealized):
Included in earnings	65			(453		)	—		(388		)
Included in other comprehensive income (loss)	—			—			—		—
Purchases, sales, issuances, and settlements, net	(7,150		)	—			—		—
Transfer into Level 3	—			—			—		—
Transfer out of Level 3	—			—			—		—
Balance at September 30, 2010	$	13,311		$	—		$	3,500	$	(388	)

Six months ended September 30, 2010	Auction Rate  Securities			Put Option on Auction Rate  Securities			Corporate Debt		Total Gains (Losses)
Balance at March 31, 2010	$	37,237		$	1,814		$	—	$	—
Total gains or losses (realized and unrealized):
Included in earnings	974			(1,814		)	—		(840		)
Included in other comprehensive income (loss)	—			—			—		—
Purchases, sales, issuances, and settlements, net	(24,900		)	—			3,500		—
Transfer into Level 3	—			—			—		—
Transfer out of Level 3	—			—			—		—
Balance at September 30, 2010	$	13,311		$	—		$	3,500	$	(840	)

Assets measured at fair value on a recurring basis are presented/classified on the condensed consolidated balance sheets at September 30, 2011 as follows (amounts in thousands):

	Quoted Prices  in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Balance
Assets
Cash and cash equivalents	$	318,820	$	356,309	$	—	$	675,129
Short-term investments	3,786		736,523		—		740,309
Long-term investments	4,292		339,370		16,318		359,980
Total assets measured at fair value	$	326,898	$	1,432,202	$	16,318	$	1,775,418

Assets and liabilities measured at fair value on a recurring basis are presented/classified in the consolidated balance sheets at March 31, 2011 as follows (amounts in thousands):

	Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs  (Level 3)		Total Balance
Assets
Cash and cash equivalents	$	464,669	$	239,255	$	—	$	703,924
Short-term investments	16,553		523,019		—		539,572
Long-term investments	10,308		438,555		15,975		464,838
Total assets measured at fair value	$	491,530	$	1,200,829	$	15,975	$	1,708,334

Financial Assets Not Recorded at Fair Value on a Recurring Basis

The Company's non-marketable equity and cost method investments are not recorded at fair value on a recurring basis.  These investments were recorded at fair value as of April 8, 2010, the date of the SST acquisition, and are monitored on a quarterly basis for impairment charges.  The investments will only be recorded at fair value when an impairment charge is recognized.  During the three and six months endedSeptember 30, 2011, there were no impairment charges recognized on these investments. These investments are included in other assets on the condensed consolidated balance sheet.  See further discussion of non-marketable investments in Note 6.