FAIR VALUE MEASUREMENTS

12 Months Ended

Jul. 31, 2011

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

NOTE 9 – FAIR VALUE MEASUREMENTS

The Company records certain of its financial assets and liabilities at fair value, which is the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date.

The current authoritative guidance discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost). Authoritative guidance utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:

• Level 1: Use of observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities.
   
• Level 2: Use of inputs other than quoted prices included in Level 1, which are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data.
   
• Level 3: Use of inputs that are unobservable.

The following table presents, for each of these hierarchy levels, the Company’s financial assets and liabilities that are measured at fair value on a recurring basis as of July 31, 2011:

				Fair Value Measurements
	As of
	Jul. 31, 2011		Level 1		Level 2		Level 3
Financial assets carried at fair value
Money market funds	$	4,575	$	4,575	$	–	$	–
Available-for-sale securities:
Equity securities		12,064		12,064				–
Debt securities:
Corporate		38,505		–		38,505		–
U.S. Treasury		10,210		–		10,210		–
Other U.S. government		29,089		–		29,089		–
Municipal government		1,002		–		1,002		–
CMO/mortgage-backed		186		–		186		–
Derivative financial instruments:
Foreign exchange forward contracts		1,456		–		1,456		–
Financial liabilities carried at fair value
Derivative financial instruments:
Foreign exchange forward contracts		478		–		478		–

The following table presents, for each of these hierarchy levels, the Company’s financial assets and liabilities that are measured at fair value as of July 31, 2010:

				Fair Value Measurements
	As of
	Jul. 31, 2010		Level 1		Level 2		Level 3
Financial assets carried at fair value
Money market funds	$	5,034	$	5,034	$	–	$	–
Available-for-sale securities:
Equity securities		5,224		5,224		–		–
Debt securities:
Corporate		27,676		–		27,676		–
U.S. Treasury		19,209		–		19,209		–
Other U.S. government		20,163		–		20,163		–
Municipal government		1,001		–		1,001		–
CMO/mortgage-backed		256		–		256		–
Derivative financial instruments:
Foreign exchange forward contracts		2,166		–		2,166		–
Financial liabilities carried at fair value
Derivative financial instruments:
Foreign exchange forward contracts		555		–		555		–

The Company’s money market funds and equity securities are valued using quoted market prices and, as such, are classified within Level 1 of the fair value hierarchy.

The fair value of the Company’s investments in debt securities, have been valued utilizing third party pricing services. The pricing services use inputs to determine fair value which are derived from observable market sources including reportable trades, benchmark curves, credit spreads, broker/dealer quotes, bids, offers, and other industry and economic events. These investments are included in Level 2 of the fair value hierarchy.

The fair value of the Company’s foreign currency forward contracts were valued using pricing models, with all significant inputs derived from or corroborated by observable market data such as yield curves, currency spot and forward rates and currency volatilities. These investments are included in Level 2 of the fair value hierarchy.

The Company completed its annual goodwill impairment test for all reporting units as discussed in Note 1, Accounting Policies and Related Matters and determined that no impairment existed. In addition, the Company had no impairment of goodwill in the prior year. In connection with the annual goodwill impairment test, the Company estimates the fair value of its reporting units using a market approach employing Level 3 inputs as defined in the fair value hierarchy.