FAIR VALUE MEASUREMENTS

12 Months Ended

Mar. 31, 2013

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

8. FAIR VALUE MEASUREMENTS

FASB ASC 820, Fair Value Measurements and Disclosures, defines and establishes a framework for measuring fair value and expands disclosures about fair value measurements. In accordance with ASC 820, we have categorized our financial assets, based on the priority of the inputs to the valuation technique, into a three-level fair value hierarchy as set forth below. If the inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

Financial assets recorded on the Consolidated Balance Sheets are categorized based on the inputs to the valuation techniques as follows:

Level 1 - Financial assets whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that the Company has the ability to access at the measurement date (examples include active exchange-traded equity securities, listed derivatives, and most U.S. government and agency securities).

Level 2 - Financial assets whose values are based on quoted prices in markets where trading occurs infrequently or whose values are based on quoted prices of instruments with similar attributes in active markets.  Level 2 inputs include the following:

·    Quoted prices for identical or similar assets or liabilities in non-active markets (examples include corporate and municipal bonds which trade infrequently);

·    Inputs other than quoted prices that are observable for substantially the full term of the asset or liability (examples include interest rate and currency swaps); and

·    Inputs that are derived principally from or corroborated by observable market data for substantially the full term of the asset or liability (examples include certain securities and derivatives).

Level 3 - Financial assets whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These inputs reflect management’s assumptions about the assumptions a market participant would use in pricing the asset or liability. The Company currently does not have any Level 3 financial assets or liabilities.

The following table presents the financial assets and liabilities we measure at fair value on a recurring basis, based on the fair value hierarchy as of March 31, 2013 and March 31, 2012:

(In thousands)	March 31, 2013		March 31, 2012
Level 1 — Financial Assets
U.S. Treasury bills	$	—	$	20,018
Money market funds	16,549		—
Total Level 1 Financial Assets	16,549		20,018
Level 2 — Financial Assets
Corporate debentures/bonds	75,572		78,169
Commercial paper	28,974		40,334
Government agency bonds	—		26,582
Money market funds	—		13,698
Certificates of deposit	4,000		5,731
Total Level 2 Financial Assets	108,546		164,514
Total cash equivalents and short-term investments	$	125,095	$	184,532

These investments are classified as available-for-sale and are recorded at their fair market values using the specific identification method. The unrealized holding gains or losses on these securities are included as a component of comprehensive income in the Consolidated Statements of Stockholders’ Equity and Comprehensive Income.

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
2013:
Short-term investments:
Corporate debentures/bonds	$	75,578	$	14	$	(20	)	$	75,572
Commercial paper	28,974		—		—			28,974
Certificates of deposit	4,000		—		—			4,000
Total short-term investments	$	108,552	$	14	$	(20	)	$	108,546
Cash equivalents:
Money market funds	16,549		—		—			16,549
Total cash equivalents	$	16,549	$	—	$	—		$	16,549

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
2012:
Short-term investments:
Corporate debentures/bonds	$	78,176	$	21	$	(28	)	$	78,169
Commercial paper	40,331		3		—			40,334
Government agency bonds	26,573		9		—			26,582
Treasury bills	20,000		18		—			20,018
Certificates of deposit	5,729		2		—			5,731
Total short-term investments	$	170,809	$	53	$	(28	)	$	170,834
Cash equivalents:
Money market funds	13,698		—		—			13,698
Total cash equivalents	$	13,698	$	—	$	—		$	13,698