Fair Value Measurements

9 Months Ended

Sep. 29, 2012

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

The guidance for fair value measurements establishes the authoritative definition of fair value, sets out a framework for measuring fair value and outlines the required disclosures regarding fair value measurements. Fair value is the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. We use a three-tier fair value hierarchy based upon observable and unobservable inputs as follows:

• Level 1 – observable inputs such as quoted prices in active markets;

• Level 2 – inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

• Level 3 – unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

Assets and Liabilities that are Measured at Fair Value on a Recurring Basis

The fair value hierarchy requires the use of observable market data when available. In instances in which the inputs used to measure fair value fall into different levels of the fair value hierarchy, the fair value measurement has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular item to the fair value measurement in its entirety requires judgment, including the consideration of inputs specific to the asset or liability.

The following tables set forth by level within the fair value hierarchy, our financial assets that were accounted for at fair value on a recurring basis at September 29, 2012, and December 31, 2011, according to the valuation techniques we used to determine their fair value (in thousands):

	September 29, 2012
	Level 1		Level 2		Level 3		Total
Marketable debt securities – current
U.S. Treasury securities	$	20,023	$	—	$	—	$	20,023
Corporate bonds	—		16,518		—		16,518
U.S. Agency bonds	—		7,619		—		7,619
Municipal bonds	—		3,072		—		3,072
	20,023		27,209		—		47,232
Marketable debt securities – non-current
U.S. Treasury securities	15,027		—		—		15,027
Corporate bonds	—		10,360		—		10,360
U.S. Agency bonds	—		7,512		—		7,512
Municipal bonds	—		2,619		—		2,619
	15,027		20,491		—		35,518
	$	35,050	$	47,700	$	—	$	82,750

	December 31, 2011
	Level 1		Level 2		Level 3		Total
Marketable debt securities – current
U.S. Treasury securities	$	20,020	$	—	$	—	$	20,020
Marketable debt securities – non-current
U.S. Treasury securities	10,042		—		—		10,042
	$	30,062	$	—	$	—	$	30,062

At September 29, 2012, and December 31, 2011, we had $1.7 million and $1.3 million, respectively, of marketable securities that fund our deferred compensation plan. We also had corresponding deferred compensation plan liabilities of $1.7 million and $1.3 million at September 29, 2012, and December 31, 2011, respectively, which are included in other long-term liabilities. A significant portion of the marketable securities are Level 1 as they trade with sufficient frequency and volume to enable us to obtain pricing information on an ongoing basis. Unrealized gains/(losses) on the marketable securities offset those associated with the corresponding deferred compensation liabilities.