Fair Value Measurements

3 Months Ended

Oct. 31, 2012

Fair Value Measurements

5. Fair value measurements:

We measure the fair value of our 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.

Our cash equivalents at October 31, 2012 and July 31, 2012 are comprised primarily of demand deposits at highly rated financial institutions.

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

	Fair Value Measurements at October 31, 2012
	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	$	-	$	14,617	$	-	$	14,617
Foreign currency forward contracts		12		-		-		12
Total assets	$	12	$	14,617	$	-	$	14,629
Foreign currency forward contracts	$	16	$	-	$	-	$	16
Contingent consideration (A)		-		-		435		435
Total liabilities	$	16	$	-	$	435	$	451
	Fair Value Measurements at July 31, 2012
	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	$	-	$	14,590	$	-	$	14,590
Foreign currency forward contracts		72		-		-		72
Total assets	$	72	$	14,590	$	-	$	14,662
Foreign currency forward contracts	$	6	$	-	$	-	$	6
Contingent consideration (A)		-		-		460		460
Total liabilities	$	6	$	-	$	460	$	466

(A) The amount of contingent consideration relates to the acquisition to acquire certain assets of an OEM ultrasound transducer and probe business in November 2010. We estimated the contingent consideration based on probability weighted expected future cash flows discounted at a rate of approximately 22.1%. The contingent consideration is marked to market at the end of each fiscal quarter and is expected to be paid in Fiscal Year 2013.