Cash, Cash Equivalents and Investments

12 Months Ended

Dec. 31, 2011

Cash, Cash Equivalents and Investments

4. Cash, Cash Equivalents and Investments

The Company's cash equivalents and short-term investments as of December 31, 2011 consisted of corporate bonds, municipal bonds, money market funds, variable-rate demand notes, U.S. government agency bonds, U.S. Treasury bills, asset-backed securities, U.S. government bonds, certificates of deposit and international government bonds. The Company's long-term investments consist of auction-rate securities. Early in fiscal 2008, auctions for many of the Company's auction-rate securities failed because sell orders exceeded buy orders. As of December 31, 2011, the Company held $19.2 million par value auction-rate securities, all of which have experienced failed auctions. The underlying assets of the securities consisted of student loans and municipal bonds, of which $17.2 million were guaranteed by the U.S. government and the remaining $2.0 million were privately insured. As of December 31, 2011, $17.2 million of the auction-rate securities had credit ratings of AAA and $2.0 million had a credit rating of A. These securities have contractual maturity dates ranging from 2029 to 2046 and with current yields of 0.21% to 3.14% per year at December 31, 2011. The Company is receiving the underlying cash flows on all of its auction-rate securities. The principal amounts associated with failed auctions are not expected to be accessible until a successful auction occurs, the issuer redeems the securities, a buyer is found outside of the auction process or the underlying securities mature. The Company is unable to predict if these funds will become available before their maturity dates.

The Company does not expect to need access to the capital represented by any of its auction-rate securities prior to their maturities. The Company does not intend to sell, and believes it is not more likely than not that it will be required to sell, its auction-rate securities before their anticipated recovery in market value or final settlement at the underlying par value. The Company believes that the credit ratings and credit support of the security issuers indicate that they have the ability to settle the securities at par value. As such, the Company has determined that no other-than-temporary impairment losses existed as of December 31, 2011.

The Company's cash, cash equivalents and investments consist of the following (in thousands):

	December 31, 2011

	Cost		Gross Unrealized Losses			Gross Unrealized Gains		Fair Value
Cash and Cash Equivalents:
Cash on hand	$	44,113	$	—		$	—	$	44,113
Available-for-sale securities:
Money market funds		50,851		—			—		50,851

Total cash and cash equivalents	$	94,964	$	—		$	—	$	94,964

Short-term Investments:
Available-for-sale securities:
Corporate bonds	$	75,189	$	(363	)	$	234	$	75,060
Municipal bonds		56,915		(12	)		81		56,984
Variable-rate demand notes		41,280		—			—		41,280
U.S. government agency		19,820		(12	)		28		19,836
U.S. Treasury bills		8,600		—			—		8,600
Asset-backed securities		5,743		(5	)		1		5,739
U.S. government bonds		2,507		—			—		2,507
Certificates of deposit		1,570		—			—		1,570
International government bonds		950		—			—		950

Total short-term investments	$	212,574	$	(392	)	$	344	$	212,526

Long-term Investments:
Available-for-sale securities:
Auction rate securities	$	19,225	$	(1,748	)	$	—	$	17,477

Total long-term investments	$	19,225	$	(1,748	)	$	—	$	17,477

	January 1, 2011

	Cost		Gross Unrealized Losses			Gross Unrealized Gains		Fair Value
Cash and Cash Equivalents:
Cash on hand	$	40,644	$	—		$	—	$	40,644
Available-for-sale securities:
U.S. Treasury bills		50,096		—			1		50,097
Money market funds		45,167		—			—		45,167
Commercial paper		2,659		—			—		2,659

Total available-for-sale securities		97,922		—			1		97,923

Total cash and cash equivalents	$	138,566	$	—		$	1	$	138,567

Short-term Investments:
Available-for-sale securities:
Corporate bonds	$	88,183	$	(46	)	$	381	$	88,518
Variable-rate demand notes		39,425		—			—		39,425
Municipal bonds		38,408		(18	)		24		38,414
U.S. government agency		34,635		(5	)		50		34,680
International government bonds		10,792		—			38		10,830
U.S. Treasury bills		6,998		—			1		6,999
Certificates of deposit		5,744		(2	)		—		5,742
Commercial paper		2,687		—			—		2,687

Total short-term investments	$	226,872	$	(71	)	$	494	$	227,295

Long-term Investments:
Available-for-sale securities:
Auction rate securities	$	19,725	$	(2,225	)	$	—	$	17,500

Total long-term investments	$	19,725	$	(2,225	)	$	—	$	17,500

The available-for-sale investments that were in a continuous unrealized loss position, aggregated by length of time that individual securities have been in a continuous loss position, were as follows (in thousands):

	Less Than 12 Months					12 Months or Greater					Total

As of December 31, 2011	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Corporate bonds	$	25,438	$	(363	)	$	—	$	—		$	25,438	$	(363	)
Auction rate securities		—		—			17,477		(1,748	)		17,477		(1,748	)
Municipal bonds		10,437		(12	)		—		—			10,437		(12	)
U.S. government agency		5,772		(12	)		—		—			5,772		(12	)
Asset-backed securities		4,539		(5	)		—		—			4,539		(5	)

	$	46,186	$	(392	)	$	17,477	$	(1,748	)	$	63,663	$	(2,140	)

	Less Than 12 Months					12 Months or Greater					Total

As of January 1, 2011	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Municipal bonds	$	22,272	$	(18	)	$	—	$	—		$	22,272	$	(18	)
Corporate bonds		17,538		(44	)		1,298		(2	)		18,836		(46	)
Auction rate securities		—		—			17,500		(2,225	)		17,500		(2,225	)
U.S. government agency		17,007		(5	)		—		—			17,007		(5	)
Certificates of deposit		1,569		(2	)		—		—			1,569		(2	)

	$	58,386	$	(69	)	$	18,798	$	(2,227	)	$	77,184	$	(2,296	)

The gross unrealized losses as of December 31, 2011 and January 1, 2011 were due primarily to the illiquidity of the Company's auction-rate securities and, to a lesser extent, to changes in market interest rates.

The following summarizes the contractual underlying maturities of the Company's available-for-sale investments at December 31, 2011 (in thousands):

	Cost		Fair Value

Due in one year or less	$	148,641	$	148,734
Due after one year through ten years		78,254		78,113
Due after ten years		55,755		54,007

	$	282,650	$	280,854