Fair Value Measurements

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following tables provide a summary of assets and liabilities measured at fair value on a recurring basis and as reported in the Condensed Consolidated Balance Sheets (in millions):



	Fair Value Measurements at September 30, 2013 Using:
	Quoted Prices in Active Markets For Identical Assets		Significant Other Observable Remaining Inputs			Significant Other Unobservable Remaining Inputs
	(Level 1)		(Level 2)			(Level 3)		Total
Assets measured at fair value:
Available-for-sale securities:
Asset-backed securities	$	—	$	253.7		$	—	$	253.7
Certificates of deposit	—		24.9			—		24.9
Commercial paper	—		11.5			—		11.5
Corporate debt securities	—		769.1			—		769.1
Foreign government debt securities	—		15.8			—		15.8
Government-sponsored enterprise obligations	—		323.7			—		323.7
Money market funds ⁽¹⁾	1,044.1		—			—		1,044.1
Mutual funds ⁽²⁾	2.5		—			—		2.5
Publicly-traded equity securities	126.7		—			—		126.7
U.S. government securities	182.2		133.3			—		315.5
Total available-for-sale securities	1,355.5		1,532.0			—		2,887.5
Trading securities in mutual funds ⁽³⁾	15.1		—			—		15.1
Derivative assets:
Foreign exchange contracts	—		2.8			—		2.8
Total assets measured at fair value	$	1,370.6	$	1,534.8		$	—	$	2,905.4
Liabilities measured at fair value:
Derivative liabilities:
Foreign exchange contracts	$	—	$	(3.4	)	$	—	$	(3.4	)
Total liabilities measured at fair value	$	—	$	(3.4	)	$	—	$	(3.4	)

Total assets measured at fair value, reported as:
Cash equivalents	$	961.0	$	88.7		$	—	$	1,049.7
Restricted investments	90.6		—			—		90.6
Short-term investments	259.1		314.6			—		573.7
Long-term investments	59.9		1,128.7			—		1,188.6
Prepaid expenses and other current assets	—		2.8			—		2.8
Total assets measured at fair value	$	1,370.6	$	1,534.8		$	—	$	2,905.4

Total liabilities measured at fair value, reported as:
Other accrued liabilities	$	—	$	(3.4	)	$	—	$	(3.4	)
Total liabilities measured at fair value	$	—	$	(3.4	)	$	—	$	(3.4	)

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⁽¹⁾	Balance includes $88.1 million of restricted investments measured at fair market value, related to the Company's D&O trust and acquisition-related escrows.


⁽²⁾	Balance relates to the restricted investments measured at fair market value of the Company's India Gratuity Trust.


⁽³⁾	Balance relates to investments measured at fair value related to the Company's non-qualified deferred compensation plan assets.



	Fair Value Measurements at December 31, 2012 Using:
	Quoted Prices in Active Markets For Identical Assets		Significant Other Observable Remaining Inputs		Significant Other Unobservable Remaining Inputs
	(Level 1)		(Level 2)		(Level 3)		Total
Assets measured at fair value:
Available-for-sale securities:
Asset-backed securities	$	—	$	226.4	$	—	$	226.4
Certificates of deposit	—		42.5		—		42.5
Commercial paper	—		22.4		—		22.4
Corporate debt securities	—		535.6		—		535.6
Foreign government debt securities	—		5.0		—		5.0
Government-sponsored enterprise obligations	254.9		16.1		—		271.0
Money market funds ⁽¹⁾	1,145.2		—		—		1,145.2
Mutual funds ⁽²⁾	1.0		2.0		—		3.0
Publicly-traded equity securities	2.9		—		—		2.9
U.S. government securities	275.9		218.6		—		494.5
Total available-for-sale securities	1,679.9		1,068.6		—		2,748.5
Trading securities in mutual funds ⁽³⁾	12.6		—		—		12.6
Derivative assets:
Foreign exchange contracts	—		3.5		—		3.5
Total assets measured at fair value	$	1,692.5	$	1,072.1	$	—	$	2,764.6
Liabilities measured at fair value:
Derivative liabilities:
Foreign exchange contracts	$	—	$	0.1	$	—	$	0.1
Total liabilities measured at fair value	$	—	$	0.1	$	—	$	0.1

Total assets measured at fair value, reported as:
Cash equivalents	$	1,048.7	$	177.2	$	—	$	1,225.9
Restricted investments	103.6		2.0		—		105.6
Short-term investments	224.4		217.1		—		441.5
Long-term investments	315.8		672.3		—		988.1
Prepaid expenses and other current assets	—		3.5		—		3.5
Total assets measured at fair value	$	1,692.5	$	1,072.1	$	—	$	2,764.6

Total liabilities measured at fair value, reported as:
Other accrued liabilities	$	—	$	0.1	$	—	$	0.1
Total liabilities measured at fair value	$	—	$	0.1	$	—	$	0.1

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⁽¹⁾	Balance includes $102.6 million of restricted investments measured at fair market value, related to the Company's D&O trust and acquisition-related escrows.


⁽²⁾	Balance relates to the restricted investments measured at fair market value of the Company's India Gratuity Trust.


⁽³⁾	Balance relates to investments measured at fair value related to the Company's non-qualified deferred compensation plan assets.

The Company's Level 2 available-for-sale fixed income securities are priced using quoted market prices for similar instruments or non-binding market prices that are corroborated by observable market data. The Company uses inputs such as actual trade data, benchmark yields, broker/dealer quotes, or alternative pricing sources with reasonable levels of price transparency which are obtained from quoted market prices, independent pricing vendors, or other sources, to determine the ultimate fair value of these assets. The Company's policy is to recognize asset or liability transfers among Level 1, Level 2, and Level 3 at the beginning of the quarter in which a change in circumstance resulted in the transfer. During the three and nine months ended September 30, 2013, the Company transferred approximately $287.4 million of government agency bonds within government-sponsored enterprise obligations from Level 1 to Level 2 primarily due to the use of additional valuation inputs more appropriately classified as Level 2 inputs. During the three and nine months ended September 30, 2013, the Company had no transfers to Level 3. During the three and nine months ended September 30, 2012, the Company had no transfers between levels of the fair value hierarchy of its assets or liabilities measured at fair value.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Certain of the Company's assets, including intangible assets, goodwill, and privately-held investments, are measured at fair value on a nonrecurring basis if impairment is indicated. Privately-held investments, which are normally carried at cost, are measured at fair value due to events and circumstances that the Company identified as significantly impacting the fair value of investments. The Company estimated the fair value of its privately-held investments using an analysis of the financial condition and near term prospects of the investee, including recent financing activities and their capital structure. During the three and nine months ended September 30, 2013, privately-held investments with a carrying value of $4.3 million and $4.7 million, respectively, were measured at fair value, resulting in an impairment charge of $2.1 million and $2.5 million, respectively. As of September 30, 2013, these investments were classified as Level 3 assets due to the absence of quoted market prices and inherent lack of liquidity. As of December 31, 2012, the Company had no assets measured at fair value on a nonrecurring basis.

As of September 30, 2013 and December 31, 2012, the Company had no liabilities measured at fair value on a nonrecurring basis.

Assets and Liabilities Not Measured at Fair Value

The carrying amounts of the Company's accounts receivable, financing receivables, accounts payable, and other accrued liabilities approximate fair value due to their short maturities. The fair value of the Company’s long-term debt is disclosed in Note 10, Long-Term Debt and Financing, and was determined using quoted market prices (Level 1).