Fair Value Measurements

9 Months Ended

Oct. 02, 2016

Fair Value Measurements (in thousands)

The following tables summarize assets and liabilities measured at fair value on a recurring basis as of October 2, 2016:



	As of October 2, 2016
	Total		Quoted market prices in active markets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Cash equivalents—money-market funds	$	10,325	$	10,325	$	—	$	—
Available-for-sale securities—U.S. treasuries (1)	127,689		127,689		—		—
Available-for-sale securities—certificates of deposit (1)	156		156		—		—
Trading securities—mutual funds (1)	1,451		1,451		—		—
Foreign currency forward contracts (2)	1,053		—		1,053		—
Total assets measured at fair value	$	140,674	$	139,621	$	1,053	$	—


(1)	Included in short-term investments on the Company’s unaudited condensed consolidated balance sheet.


(2)	Included in prepaid expenses and other current assets on the Company’s unaudited condensed consolidated balance sheet.



	As of October 2, 2016
	Total		Quoted market prices in active markets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Foreign currency forward contracts (3)	$	1,285	$	—	$	1,285	$	—
Total liabilities measured at fair value	$	1,285	$	—	$	1,285	$	—


(3)	Included in other accrued liabilities on the Company’s unaudited condensed consolidated balance sheet.

The following tables summarize assets and liabilities measured at fair value on a recurring basis as of December 31, 2015:



	As of December 31, 2015
	Total		Quoted market prices in active markets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Cash equivalents—money-market funds	$	10,976	$	10,976	$	—	$	—
Available-for-sale securities—U.S. treasuries (1)	94,993		94,993		—		—
Available-for-sale securities—certificates of deposit (1)	147		147		—		—
Trading securities—mutual funds (1)	1,181		1,181		—		—
Foreign currency forward contracts (2)	3,205		—		3,205		—
Total assets measured at fair value	$	110,502	$	107,297	$	3,205	$	—


(1)	Included in short-term investments on the Company’s unaudited condensed consolidated balance sheet.


(2)	Included in prepaid expenses and other current assets on the Company’s unaudited condensed consolidated balance sheet.



	As of December 31, 2015
	Total		Quoted market prices in active markets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Foreign currency forward contracts (3)	$	451	$	—	$	451	$	—
Total liabilities measured at fair value	$	451	$	—	$	451	$	—


(3)	Included in other accrued liabilities on the Company’s unaudited condensed consolidated balance sheet.

The Company’s investments in cash equivalents and available-for-sale securities are classified within Level 1 of the fair value hierarchy because they are valued based on quoted market prices in active markets. The Company enters into foreign currency forward contracts with only those counterparties that have long-term credit ratings of A-/A3 or higher. The Company’s foreign currency forward contracts are classified within Level 2 of the fair value hierarchy as they are valued using pricing models that take into account the contract terms as well as currency rates and counterparty credit rates. The Company verifies the reasonableness of these pricing models using observable market data for related inputs into such models. Additionally, the Company includes an adjustment for non-performance risk in the recognized measure of fair value of derivative instruments. At October 2, 2016 and December 31, 2015, the adjustment for non-performance risk did not have a material impact on the fair value of the Company’s foreign currency forward contracts. The carrying value of non-financial assets and liabilities measured at fair value in the financial statements on a recurring basis, including accounts receivable and accounts payable, approximate fair value due to their short maturities.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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