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Financial Instruments and Fair Value Measurements | 12 Months Ended
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Apr. 24, 2015
Investments Debt And Equity Securities [Abstract] |
Financial Instruments and Fair Value Measurements | 9. Financial Instruments and Fair Value Measurements The accounting guidance for fair value measurements provides a framework for measuring fair value on either a recurring or nonrecurring basis, whereby the inputs used in valuation techniques are assigned a hierarchical level. The following are the three levels of inputs to measure fair value: Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2: Inputs that reflect quoted prices for identical assets or liabilities in less active markets; quoted prices for similar assets or liabilities in active markets; benchmark yields, reported trades, broker/dealer quotes, inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. Level 3: Unobservable inputs that reflect our own assumptions incorporated in valuation techniques used to measure fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. We consider an active market to be one in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis, and consider an inactive market to be one in which there are infrequent or few transactions for the asset or liability, the prices are not current, or price quotations vary substantially either over time or among market makers. Where appropriate, our own or the counterparty’s non-performance risk is considered in measuring the fair values of liabilities and assets, respectively. Investments The following is a summary of our investments (in millions):
|  | April 24, 2015 |  |  | April 25, 2014 |
|  | Cost or |  |  |  |  |  | Estimated |  |  | Cost or |  |  |  |  |  | Estimated |
|  | Amortized |  |  | Gross Unrealized |  |  | Fair |  |  | Amortized |  |  | Gross Unrealized |  |  | Fair |
|  | Cost |  |  | Gains |  |  | Losses |  |  | Value |  |  | Cost |  |  | Gains |  |  | Losses |  |  | Value |
Corporate bonds |  | $ | 2,249.4 |  |  | $ | 8.7 |  |  | $ | (0.5 | ) |  |  | 2,257.6 |  |  | $ | 2,142.3 |  |  | $ | 10.5 |  |  | $ | (0.5 | ) |  | $ | 2,152.3 |
U.S. Treasury and government debt securities |  |  | 1,055.7 |  |  |  | 2.5 |  |  |  | — |  |  |  | 1,058.2 |  |  |  | 263.4 |  |  |  | 0.3 |  |  |  | (0.1 | ) |  |  | 263.6 |
Foreign government debt securities |  |  | 37.7 |  |  |  | 0.2 |  |  |  | — |  |  |  | 37.9 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Commercial paper |  |  | 20.0 |  |  |  | — |  |  |  | — |  |  |  | 20.0 |  |  |  | 168.4 |  |  |  | — |  |  |  | — |  |  |  | 168.4 |
Certificates of deposit |  |  | 286.2 |  |  |  | — |  |  |  | — |  |  |  | 286.2 |  |  |  | 245.0 |  |  |  | — |  |  |  | — |  |  |  | 245.0 |
Auction rate securities |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 36.9 |  |  |  | — |  |  |  | (0.9 | ) |  |  | 36.0 |
Mutual funds |  |  | 32.2 |  |  |  | — |  |  |  | — |  |  |  | 32.2 |  |  |  | 32.7 |  |  |  | — |  |  |  | — |  |  |  | 32.7 |
Total debt and equity securities |  | $ | 3,681.2 |  |  | $ | 11.4 |  |  | $ | (0.5 | ) |  | $ | 3,692.1 |  |  | $ | 2,888.7 |  |  | $ | 10.8 |  |  | $ | (1.5 | ) |  | $ | 2,898.0 |
As of April 24, 2015, gross unrealized losses related to individual securities were not significant. The following table shows the gross unrealized losses and estimated fair values of our available-for-sale investments with gross unrealized losses and the length of time that individual securities have been in continuous unrealized loss positions as of April 25, 2014 (in millions):
|  | April 25, 2014 |
|  | Less than 12 Months |  |  | 12 Months or Greater |  |  | Total |
|  | Fair Value |  |  | Unrealized Loss |  |  | Fair Value |  |  | Unrealized Loss |  |  | Fair Value |  |  | Unrealized Loss |
Corporate bonds |  | $ | 233.1 |  |  | $ | (0.5 | ) |  | $ | — |  |  | $ | — |  |  | $ | 233.1 |  |  | $ | (0.5 | )
U.S. Treasury and government debt securities |  |  | 63.0 |  |  |  | (0.1 | ) |  |  | — |  |  |  | — |  |  |  | 63.0 |  |  |  | (0.1 | )
Auction rate securities |  |  | — |  |  |  | — |  |  |  | 36.0 |  |  |  | (0.9 | ) |  |  | 36.0 |  |  |  | (0.9 | )
Total |  | $ | 296.1 |  |  | $ | (0.6 | ) |  | $ | 36.0 |  |  | $ | (0.9 | ) |  | $ | 332.1 |  |  | $ | (1.5 | )
The following table presents the contractual maturities of our debt investments as of April 24, 2015 (in millions):
|  | Amortized Cost |  |  | Fair Value |
Due in one year or less |  | $ | 1,437.8 |  |  | $ | 1,440.2 |
Due after one year through five years |  |  | 2,211.2 |  |  |  | 2,219.7 |
|  | $ | 3,649.0 |  |  | $ | 3,659.9 |
Actual maturities may differ from the contractual maturities because borrowers may have the right to call or prepay certain obligations. Fair Value of Financial Instruments The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis (in millions):
|  | April 24, 2015 |
|  |  |  |  |  | Fair Value Measurements at Reporting Date Using |
|  | Total |  |  | Level 1 |  |  | Level 2 |
Cash |  | $ | 1,666.3 |  |  | $ | 1,666.3 |  |  | $ | — |
Corporate bonds |  |  | 2,257.6 |  |  |  | — |  |  |  | 2,257.6 |
U.S. Treasury and government debt securities |  |  | 1,058.2 |  |  |  | 145.6 |  |  |  | 912.6 |
Foreign government debt securities |  |  | 37.9 |  |  |  | — |  |  |  | 37.9 |
Commercial paper |  |  | 20.0 |  |  |  | — |  |  |  | 20.0 |
Certificates of deposit |  |  | 286.2 |  |  |  | — |  |  |  | 286.2 |
Total cash, cash equivalents and short-term investments |  | $ | 5,326.2 |  |  | $ | 1,811.9 |  |  | $ | 3,514.3 |
Other items: |  |  |  |  |  |  |  |  |  |  |  |
Mutual funds (1) |  | $ | 2.8 |  |  | $ | 2.8 |  |  | $ | — |
Mutual funds (2) |  | $ | 29.4 |  |  | $ | 29.4 |  |  | $ | — |
Foreign currency exchange contracts assets (1) |  | $ | 3.4 |  |  | $ | — |  |  | $ | 3.4 |
Long-term debt |  | $ | (1,523.6 | ) |  | $ | — |  |  | $ | (1,523.6 | )
|  | April 25, 2014 |
|  |  |  |  |  | Fair Value Measurements at Reporting Date Using |
|  | Total |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
Cash |  | $ | 2,174.0 |  |  | $ | 2,174.0 |  |  | $ | — |  |  | $ | — |
Corporate bonds |  |  | 2,152.3 |  |  |  | — |  |  |  | 2,152.3 |  |  |  | — |
U.S. Treasury and government debt securities |  |  | 263.6 |  |  |  | 185.1 |  |  |  | 78.5 |  |  |  | — |
Commercial paper |  |  | 168.4 |  |  |  | — |  |  |  | 168.4 |  |  |  | — |
Certificates of deposit |  |  | 245.0 |  |  |  | — |  |  |  | 245.0 |  |  |  | — |
Total cash, cash equivalents and short-term investments |  | $ | 5,003.3 |  |  | $ | 2,359.1 |  |  | $ | 2,644.2 |  |  | $ | — |
Other items: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Auction rate securities (2) |  | $ | 36.0 |  |  | $ | — |  |  | $ | — |  |  | $ | 36.0 |
Mutual funds (1) |  | $ | 6.4 |  |  | $ | 6.4 |  |  | $ | — |  |  | $ | — |
Mutual funds (2) |  | $ | 26.3 |  |  | $ | 26.3 |  |  | $ | — |  |  | $ | — |
Foreign currency exchange contracts assets (1) |  | $ | 0.4 |  |  | $ | — |  |  | $ | 0.4 |  |  | $ | — |
Foreign currency exchange contracts liabilities (3) |  | $ | (1.9 | ) |  | $ | — |  |  | $ | (1.9 | ) |  | $ | — |
Long-term debt |  | $ | (1,000.0 | ) |  | $ | — |  |  | $ | (1,000.0 | ) |  | $ | — |
(1) | Reported as other current assets in the consolidated balance sheets
(2) | Reported as other non-current assets in the consolidated balance sheets
(3) | Reported as accrued expenses in the consolidated balance sheets
Our Level 2 debt instruments are held by a custodian who prices some of the investments using standard inputs in various asset price models or obtains investment prices from third-party pricing providers that incorporate standard inputs in various asset price models. These pricing providers utilize the most recent observable market information in pricing these securities or, if specific prices are not available for these securities, use other observable inputs like market transactions involving identical or comparable securities. We review Level 2 inputs and fair value for reasonableness and the values may be further validated by comparison to multiple independent pricing sources. In addition, we review third-party pricing provider models, key inputs and assumptions and understand the pricing processes at our third-party providers in determining the overall reasonableness of the fair value of our Level 2 financial instruments. As of April 24, 2015 and April 25, 2014, we have not made any adjustments to the prices obtained from our third-party pricing providers. During fiscal 2015, we settled our remaining ARS investments, which had been classified as Level 3 financial instruments at their respective par values. Quantitative information about our Level 3 fair value measurements as of April 24, 2014 for our ARSs is as follows:
|  | Estimated Fair Value as of April 25, 2014 (in millions) |  |  | Valuation Techniques |  | Unobservable Inputs |  | Range (Weighted average)
ARSs |  | $ | 36.0 |  |  | Discounted cash flow |  | Time-to-economic maturity |  | 6.7 yrs - 10.0 yrs (8.2 yrs)
|  |  |  |  |  |  |  | Illiquidity premium |  | 1.1% - 2.8% (1.8%)
|  |  |  |  |  |  |  | Coupon rate |  | 1.1% - 2.7% (1.8%)
|  |  |  |  |  | Market comparable securities |  | Discount rate |  | 1.0% - 5.0% (2.4%)
All of our ARSs were backed by pools of student loans guaranteed by the U.S. Department of Education. We estimated the fair value of each individual ARS using an income (discounted cash flow) and market approach that incorporated both observable and unobservable inputs. Key inputs into the discounted cash flow analysis included the time-to-economic maturity, illiquidity premium, (which factors in liquidity risk, market credit spread and other factors), and a coupon rate. The key input into the market approach is a discount rate. We reviewed the fair value of our Level 3 financial instruments for overall reasonableness by reviewing service provider pricing methodologies, key inputs and assumptions and by understanding the processes used by our third-party service provider. The table below provides a reconciliation of the beginning and ending balance of our Level 3 ARSs measured at fair value on a recurring basis using significant unobservable inputs (in millions):
|  | Year Ended |
|  | April 24, 2015 |  |  | April 25, 2014 |  |  | April 26, 2013 |
Balance at beginning of year |  | $ | 36.0 |  |  | $ | 42.0 |  |  | $ | 51.0 |
Total unrealized gains, net included in other comprehensive income (loss) |  |  | 0.9 |  |  |  | 1.3 |  |  |  | 0.5 |
Total realized gains included in earnings |  |  | — |  |  |  | 0.7 |  |  |  | 1.1 |
Sales |  |  | (10.0 | ) |  |  | (8.0 | ) |  |  | — |
Settlements |  |  | (26.9 | ) |  |  | — |  |  |  | (10.6 | )
Balance at end of year |  | $ | — |  |  | $ | 36.0 |  |  | $ | 42.0 |
Fair Value of Long-Term Debt The fair value of our long-term debt was based on observable market prices in a less active market and discounted cash flow models that take into consideration variables such as credit-rating and interest rate changes. All of our debt obligations are categorized as Level 2 instruments.

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- Definition The entire disclosure for financial instruments. This disclosure includes, but is not limited to, fair value measurements of short and long term marketable securities, international currencies forward contracts, and auction rate securities. Financial instruments may include hedging and non-hedging currency exchange instruments, derivatives, securitizations and securities available for sale at fair value. Also included are investment results, realized and unrealized gains and losses as well as impairments and risk management disclosures. + References No definition available. + Details
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