Cash, Cash Equivalents, and Short-Term Investments

6 Months Ended

Jul. 02, 2011

Cash, Cash Equivalents, and Short-Term Investments

Cash, Cash Equivalents, and Short-Term Investments

6. Cash, Cash Equivalents, and Short-Term Investments

        Cash equivalents consist principally of money market funds, commercial paper, bankers' acceptances, and certificates of deposit with maturities of three months or less when purchased. As of July 2, 2011, a portion of the Company's cash accounts are concentrated at a single financial institution, which potentially exposes the Company to credit risks. As of July 2, 2011, the financial institution has generally stable credit ratings and the Company has not experienced any losses related to such accounts. The Company does not believe that there is significant risk of non-performance by the financial institution, the cash on deposit is fully liquid, and the Company continually monitors the credit ratings of such institution.

        Short-term investments consist of commercial paper and have maturities of more than three months and less than one year when purchased. These short-term investments are expected to be held-to-maturity and are classified as such in the accompanying condensed consolidated financial statements. The carrying amounts of these instruments classified as cash equivalents and short-term investments are stated at amortized cost, which approximates fair value because of their short-term maturity. As of July 2, 2011, short-term investments included $14.5 million in corporate obligations. At January 1, 2011, CRA did not hold any short-term investments.

        If a decline in fair value below the amortized cost basis of an investment is judged to be other-than-temporary, the cost basis of the investment is written down to fair value. For those investments for which the fair value of the investment is less than its amortized cost, the credit-related portion of other-than-temporary impairment losses is recognized in earnings while the noncredit-related portion is recognized in other comprehensive income, net of related taxes. The Company does not intend to sell such investments, if any, and it is more likely than not that it will not be required to sell such investments prior to the recovery of its amortized cost basis less any current period credit losses. During the second quarter and the fiscal year to date period ended July 2, 2011, the Company did not write-down any investment balances.