Fair value measurements

9 Months Ended

Apr. 30, 2012

Fair value measurements

7. Fair value measurements:

The Company measures the fair value of its financial assets and liabilities and non-financial assets and liabilities at least annually using a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, as follows:

• Level 1 – Quoted prices in active markets for identical assets or liabilities.

• Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

• Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company’s cash equivalents at April 30, 2012 and July 31, 2011 are comprised primarily of demand deposits and money market funds at highly rated financial institutions.

The following table provides the assets and liabilities carried at fair value measured on a recurring basis at April 30, 2012 and July 31, 2011:

	Fair Value Measurements at April 30, 2012 using
	Quoted Prices in Active Markets for Identical Assets Level 1		Significant Other Observable Inputs Level 2		Significant Unobservable Inputs Level 3		Total Carrying Value
Cash equivalents	$	20,000	$	14,500	$	-	$	34,500
Foreign currency forward contracts		-		64		-		64
Total assets	$	20,000	$	14,564	$	-	$	34,564
Contingent consideration	$	-	$	-	$	383	$	383
Total liabilities	$	-	$	-	$	383	$	383
	Fair Value Measurements at July 31, 2011 using
	Quoted Prices in Active Markets for Identical Assets Level 1		Significant Other Observable Inputs Level 2		Significant Unobservable Inputs Level 3		Total Carrying Value
Cash equivalents	$	-	$	9,600	$	-	$	9,600
Total assets	$	-	$	9,600	$	-	$	9,600
Contingent consideration	$	-	$	-	$	340	$	340
Total liabilities	$	-	$	-	$	340	$	340

The Company’s Level 2 instruments classified as cash equivalents consist of highly liquid demand deposits. The fair value of these deposits does not deviate from the face value.

The fair value of the Company’s Level 2 instruments classified as foreign currency forward contracts is determined using valuation models based on market observable inputs, including forward and spot prices for currencies and implied volatilities.