Short-term Investments

12 Months Ended

Jul. 31, 2011

Short-term Investments [Abstract]

Short-term Investments

5.   Short-Term Investments

Short-term investments consist of the following:

			Gross		Gross
	Cost		Unrealized		Unrealized			Fair
	Basis		Gains		Losses			Value
	(In thousands)
As of July 31, 2011
Corporate bonds and notes	$	41,912	$	118	$	(10	)	$	42,020
U.S. government agency securities		40,824		33		(7	)		40,850
U.S. treasury bills		57,026		72		(5	)		57,093
Commercial paper		5,590		2		—			5,592
Certificates of deposit		7,618		12		—			7,630
Total short-term investments	$	152,970	$	237	$	(22	)	$	153,185

			Gross		Gross
	Cost		Unrealized		Unrealized			Fair
	Basis		Gains		Losses			Value
	(In thousands)
As of July 31, 2010
Corporate bonds and notes	$	23,802	$	69	$	(4	)	$	23,867
U.S. government agency securities		80,683		78		(9	)		80,752
U.S. treasury bills		12,816		57		—			12,873
Commercial paper		4,495		—		—			4,495
Certificates of deposit		2,179		1		—			2,180
Total short-term investments	$	123,975	$	205	$	(13	)	$	124,167

The cost basis and fair value of debt securities by contractual maturity are presented below:

	Cost		Fair
	Basis		Value
	(In thousands)
As of July 31, 2011
One year or less	$	60,255	$	60,358
One to two years		92,715		92,827
Total short-term investments	$	152,970	$	153,185

	Cost		Fair
	Basis		Value
	(In thousands)
As of July 31, 2010
One year or less	$	93,597	$	93,700
One to two years		30,378		30,467
Total short-term investments	$	123,975	$	124,167

The Company reviews the individual securities in its portfolio to determine whether a decline in a security’s fair value below the amortized cost basis is other than temporary. The Company determined that there were no investments in its portfolio, related to credit losses or otherwise, that were other-than temporarily impaired during fiscal 2011, 2010 or 2009.

The following table summarizes the fair value and gross unrealized losses of the Company’s investments with unrealized losses aggregated by type of investment instrument and length of time that individual securities have been in a continuous unrealized loss position:

	Less Than 12 Months
	Fair		Unrealized
	Value		Loss
	(In thousands)
As of July 31, 2011
Corporate bonds and notes	$	6,264	$	(10	)
U.S. government agency securities		11,576		(7	)
U.S. treasury bill		10,029		(5	)
	$	27,869	$	(22	)

	Less Than 12 Months
	Fair		Unrealized
	Value		Loss
	(In thousands)
As of July 31, 2010
Corporate bonds and notes	$	7,400	$	(4	)
U.S. government agency securities		15,245		(9	)
	$	22,645	$	(13	)

There were no short-term investments in a continuous unrealized loss position for more than 12 months as of July 31, 2011 and 2010.

Fair Value of Financial Instruments

Cash and cash equivalents consist primarily of bank deposits with third-party financial institutions and highly liquid money market securities with original maturities at date of purchase of 90 days or less and are stated at cost which approximates fair value.

Short-term investments are recorded at fair value, defined as the exit price in the principal market in which the Company would transact representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. Level 1 instruments are valued based on quoted market prices in active markets for identical instruments and include the Company’s investments in money market funds. Level 2 securities are valued using quoted market prices for similar instruments, nonbinding market prices that are corroborated by observable market data, or discounted cash flow techniques and include the Company’s investments in corporate bonds and notes, U.S. government agency securities, U.S. treasury bills, and commercial paper. Level 3 instruments are valued based on unobservable inputs that are supported by little or no market activity and reflect the Company’s own assumptions in measuring fair value. The Company has no short-term investments classified as Level 3 instruments. There were no transfers between different levels during fiscal 2011.

The fair value measurements of the Company’s cash, cash equivalents and short-term investments consisted of the following:

	Total		Level 1		Level 2
	(In thousands)
As of July 31, 2011
Corporate bonds and notes	$	42,020		—	$	42,020
U.S. government agency securities		40,850		—		40,850
U.S. treasury bills		57,093		—		57,093
Commercial paper		5,592		—		5,592
Money market funds		16,722		16,722		—
Total cash equivalents and short-term investments		162,277	$	16,722	$	145,555
Certificates of deposit		7,630
Cash deposits with third-party financial institutions		64,051
Total cash, cash equivalents and short-term investments	$	233,958

	Total		Level 1		Level 2
	(In thousands)
As of July 31, 2010
Corporate bonds and notes	$	23,867		—	$	23,867
U.S. government agency securities		80,752		—		80,752
U.S. treasury bills		12,873		—		12,873
Commercial paper		4,495		—		4,495
Money market funds		9,895		9,895		—
Total cash equivalents and short-term investments		131,882	$	9,895	$	121,987
Certificates of deposit		2,180
Cash deposits with third-party financial institutions		21,359
Total cash, cash equivalents and short-term investments	$	155,421