Fair Value Measurements

9 Months Ended

Mar. 31, 2012

Fair Value Measurements [Abstract]

Fair Value Measurements

Note 7. Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date and is based upon the Company's principal or most advantageous market for a specific asset or liability.

U.S. GAAP provides for a three-level hierarchy of inputs to valuation techniques used to measure fair value, defined as follows:

Level 1    Fair value is determined based upon quoted prices for identical assets or liabilities that are traded in active markets.

Level 2    Fair value is determined based upon inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability, including:

• 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;
• inputs other than quoted prices that are observable for the asset or liability; or
• inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Level 3    Fair value is determined based upon inputs that are unobservable and reflect the Company's own assumptions about the assumptions that market participants would use in pricing the asset or liability based upon the best information available in the circumstances (e.g., internally derived assumptions surrounding the timing and amount of expected cash flows).

Available-for-sale securities included in Level 1 are valued using closing prices for identical instruments that are traded on active exchanges. Available-for-sale securities included in Level 2 are valued utilizing inputs obtained from an independent pricing service. To determine the fair value of the Company's Level 2 investments, a variety of inputs are utilized, including benchmark yields, reported trades, non-binding broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers, reference data, new issue data, and monthly payment information. Over 99% of the Company's Level 2 investments are valued utilizing inputs obtained from a pricing service. The Company reviews the values generated by the independent pricing service for reasonableness by comparing the valuations received from the independent pricing service to valuations from at least one other observable source.

The Company has not adjusted the prices obtained from the independent pricing service. The Company has no available-for-sale securities included in Level 3.

The Company's assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the classification of assets and liabilities within the fair value hierarchy. In certain instances, the inputs used to measure fair value may meet the definition of more than one level of the fair value hierarchy. The significant input with the lowest level priority is used to determine the applicable level in the fair value hierarchy.

The following table presents the Company's assets measured at fair value on a recurring basis at March 31, 2012. Included in the table are available-for-sale securities within corporate investments of $124.8 million and funds held for clients of $17,594.1 million.

		Level 1		Level 2		Level 3		Total
U.S Treasury and direct obligations of
U.S. government agencies	$	-	$	6,683.6	$	-	$	6,683.6
Corporate bonds		-		7,142.9		-		7,142.9
Asset-backed securities		-		414.4		-		414.4
Commercial mortgage-backed securities		-		337.2		-		337.2
Municipal bonds		-		539.3		-		539.3
Canadian government obligations and
Canadian government agency obligations		-		1,043.3		-		1,043.3
Other securities		22.9		1,535.3		-		1,558.2
Total available-for-sale securities	$	22.9	$	17,696.0	$	-	$	17,718.9

The following table presents the Company's assets measured at fair value on a recurring basis at June 30, 2011. Included in the table are available-for-sale securities within corporate investments of $134.3 million and funds held for clients of $16,793.2 million.

		Level 1		Level 2		Level 3		Total
U.S Treasury and direct obligations of
U.S. government agencies	$	-	$	6,759.1	$	-	$	6,759.1
Corporate bonds		-		6,126.6		-		6,126.6
Asset-backed securities		-		447.8		-		447.8
Commercial mortgage-backed securities		-		492.5		-		492.5
Municipal bonds		-		516.2		-		516.2
Canadian government obligations and
Canadian government agency obligations		-		1,101.5		-		1,101.5
Other securities		20.1		1,463.7		-		1,483.8
Total available-for-sale securities	$	20.1	$	16,907.4	$	-	$	16,927.5