Fair Value Measurements

12 Months Ended

Nov. 30, 2012

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

Recurring Fair Value Measurements

The following table details the fair value measurements within the fair value hierarchy of our financial assets at November 30, 2012 (in thousands):

				Fair Value Measurements Using
	Total Fair Value			Level 1		Level 2			Level 3
Money market funds	$	125,591		$	125,591	$	—		$	—
State and municipal bond obligations	50,818			—		50,818			—
Auction rate securities – municipal bonds	23,420			—		—			23,420
Auction rate securities – student loans	2,901			—		—			2,901
Corporate bonds	2,607			—		2,607			—
Foreign exchange derivatives	(186		)	—		(186		)	—

The following table details the fair value measurements within the fair value hierarchy of our financial assets at November 30, 2011 (in thousands):

			Fair Value Measurements Using
	Total Fair Value		Level 1		Level 2		Level 3
Money market funds	$	24,220	$	24,220	$	—	$	—
State and municipal bond obligations	84,398		—		84,398		—
Brazilian mutual funds	15,346		15,346		—		—
Auction rate securities – municipal bonds	22,931		—		—		22,931
Auction rate securities – student loans	10,608		—		—		10,608
Corporate bonds	2,562		—		2,562		—
Foreign exchange derivatives	52		—		52		—

When developing fair value estimates, we maximize the use of observable inputs and minimize the use of unobservable inputs. When available, we use quoted market prices to measure fair value. The valuation technique used to measure fair value for our Level 1 and Level 2 assets is a market approach, using prices and other relevant information generated by market transactions involving identical or comparable assets. If market prices are not available, the fair value measurement is based on models that use primarily market based parameters including yield curves, volatilities, credit ratings and currency rates. In certain cases where market rate assumptions are not available, we are required to make judgments about assumptions market participants would use to estimate the fair value of a financial instrument.

The valuation technique used to measure fair value for our Level 3 assets, which consists of our ARS, is an income approach, where the expected weighted average future cash flows are discounted back to present value for each asset. The significant unobservable inputs used in the fair value measurement of our ARS are the probability of earning the maximum rate until maturity, the probability of principal return prior to maturity, the probability of default, the liquidity risk premium and the recovery rate in default. Changes in the underlying assumptions used to value the ARS could significantly impact the fair value estimates recorded in the consolidated balance sheets.

The following table reflects the activity for our financial assets measured at fair value using Level 3 inputs for each period presented (in thousands):

	November 30, 2012			November 30, 2011
Balance, beginning of period	$	33,539		$	39,643
Redemptions and sales	(6,255		)	(6,300		)
Transfer to Level 2 fair value measurement	(2,700		)	—
Realized losses included in earnings	(270		)	—
Unrealized gains included in accumulated other comprehensive loss	2,007			196
Balance, end of period	$	26,321		$	33,539

During the second quarter of fiscal year 2012, we received a redemption notice for one of our ARS at par value. We transferred the ARS to a Level 2 fair value measurement, as the value at the end of the second quarter was based on observable inputs. The ARS was redeemed in the third quarter of fiscal year 2012. During the fourth quarter of fiscal year 2012, we received a notice to tender one of our ARS, which we executed and recorded a realized loss in other income (expense) in the consolidated statement of income.

Nonrecurring Fair Value Measurements

The following table details our nonrecurring fair value measurements during fiscal year 2012 (in thousands):

			Fair Value Measurements Using
	Total Fair Value		Level 1		Level 2		Level 3		Total Losses
Disposal group	$	16,487	$	—	$	16,487	$	—	$	8,601

The disposal group includes the assets and liabilities held for sale of the Artix, Orbacus and Orbix product lines, which has a fair value of $16.5 million (Note 7). The carrying value of $25.1 million was written down to fair value, less costs to sell, resulting in a loss of $8.6 million. The loss was recorded in income (loss) from discontinued operations.

We evaluate all of our assets held for sale using undiscounted cash flow models or other valuation models, such as comparative transactions and market multiples, to determine their fair values. However, a market approach was more heavily used to value the assets held for sale related to the divestitures of our non-Core product lines as part of the Plan. As bid and transaction values become apparent as we move through the marketing and divestiture process, the fair values of the assets held for sale is established. The impairment loss recorded for the Artix, Orbacus and Orbix product lines was primarily based on our expectations of a sale price as compared to our estimation of the net assets to be sold at closing. All other non-Core product lines have been sold at a gain in fiscal year 2012 or the first quarter of fiscal year 2013 (Note 7).