FAIR VALUE MEASUREMENTS

6 Months Ended

Jan. 31, 2012

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

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 January 31, 2012:

	Fair Value Measurements
	As of
	Jan 31, 2012		Level 1		Level 2		Level 3
Financial assets carried at fair value
Money market funds	$	3,662	$	3,662	$	—	$	—
Available-for-sale securities:
Equity securities	1,014		1,014		—		—
Debt securities:
Corporate	31,710		—		31,710		—
U.S. Treasury	9,694		—		9,694		—
Federal agency	28,962		—		28,962		—
Mortgage-backed	6,340		—		6,340		—
Municipal government	1,000		—		1,000		—
Derivative financial instruments:
Foreign exchange forward contracts	2,968		—		2,968		—
Financial liabilities carried at fair value
Derivative financial instruments:
Foreign exchange forward contracts	934		—		934		—

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	32,020		—		32,020		—
U.S. Treasury	10,210		—		10,210		—
Federal agency	29,404		—		29,404		—
Mortgage-backed	6,356		—		6,356		—
Municipal government	1,002		—		1,002		—
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 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 are 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 values of the Company’s foreign currency forward contracts are 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.

In connection with the acquisition in the first quarter of fiscal year 2012, the Company recorded the fair value of the intangible assets acquired, which were valued using the income approach. The valuation employed level 3 inputs, as defined in the fair value hierarchy.