XML 60 R14.htm IDEA: XBRL DOCUMENT v2.4.0.6
Fair Value of Financial Instruments
 3 Months Ended
Mar. 31, 2013
Fair Value Disclosures [Abstract]  
Fair Value of Financial Instruments
Fair Value of Financial Instruments
The Company tests the pricing inputs by obtaining prices from two different sources for the same security on a sample of its portfolio. The Company has not adjusted the pricing inputs it has obtained. The following table presents the financial instruments that are carried at fair value and summarizes the valuation of its cash equivalents and marketable securities by the above pricing levels as of March 31, 2013 and December 31, 2012:
 
As of March 31, 2013
 
Total
 
Quoted
 Market
 Prices in
 Active
 Markets
 (Level 1)
 
Significant
 Other
 Observable
 Inputs
 (Level 2)
 
Significant
 Unobservable
 Inputs
 (Level 3)
 
(In thousands)
Money market funds
$
139,768

 
$
139,768

 
$
—

 
$
—

Corporate notes, bonds and commercial paper
58,614

 
—

 
58,614

 
—

Total available-for-sale securities
$
198,382

 
$
139,768

 
$
58,614

 
$
—

 
As of December 31, 2012
 
Total
 
Quoted
 Market
 Prices in
 Active
 Markets
 (Level 1)
 
Significant
 Other
 Observable
 Inputs
 (Level 2)
 
Significant
 Unobservable
 Inputs
 (Level 3)
 
(In thousands)
Money market funds
$
126,570

 
$
126,570

 
$
—

 
$
—

Corporate notes, bonds and commercial paper
57,345

 
—

 
57,345

 
—

Total available-for-sale securities
$
183,915

 
$
126,570

 
$
57,345

 
$
—



The Company monitors the investment for other-than-temporary impairment and records appropriate reductions in carrying value when necessary. The Company made an investment of $2.0 million in a non-marketable equity security of a private company during 2009. The Company evaluated the fair value of the investment in the non-marketable security as of March 31, 2013 and determined that there were no events that caused a decrease in its fair value below the carrying cost.
The following table presents the financial instruments that are measured and carried at cost on a nonrecurring basis as of March 31, 2013 and December 31, 2012:
 
 
As of March 31, 2013
(in thousands)
 
Carrying
 Value
 
Quoted
 market
 prices in
 active
 markets
 (Level 1)
 
Significant
 other
 observable
 inputs
 (Level 2)
 
Significant
 unobservable
 inputs
 (Level 3)
 
Impairment
charges for the
three months
ended March 31,
 2013
Investment in non-marketable securities
 
$
2,000

 
$
—

 
$
—

 
$
2,000

 
$
—

 
 
As of December 31, 2012
(in thousands)
 
Carrying
 Value
 
Quoted
 market
 prices in
 active
 markets
 (Level 1)
 
Significant
 other
 observable
 inputs
 (Level 2)
 
Significant
 unobservable
 inputs
 (Level 3)
 
Impairment
charges for the
year
 ended
December 31,
2012
Investment in non-marketable securities
 
$
2,000

 
$
—

 
$
—

 
$
2,000

 
$
—



For the three months ended March 31, 2013 and 2012, there were no transfers of financial instruments between different categories of fair value.
The following table presents the financial instruments that are not carried at fair value but require fair value disclosure as of March 31, 2013 and December 31, 2012:
 
 
As of March 31, 2013
 
As of December 31, 2012
(in thousands)
 
Face
 Value
 
Carrying
 Value
 
Fair Value
 
Face
 Value
 
Carrying
 Value
 
Fair Value
5% Convertible Senior Notes due 2014
 
$
172,500

 
$
151,487

 
$
175,519

 
$
172,500

 
$
147,556

 
$
172,716



The fair value of the convertible notes at each balance sheet date is determined based on recent quoted market prices for these notes which is a level two measurement. As discussed in Note 8, "Convertible Notes," as of March 31, 2013, the convertible notes are carried at face value of $172.5 million less any unamortized debt discount. The carrying value of other financial instruments, including accounts receivable, accounts payable and other payables, approximates fair value due to their short maturities.
The Company monitors its investments for other than temporary losses by considering current factors, including the economic environment, market conditions, operational performance and other specific factors relating to the business underlying the investment, reductions in carrying values when necessary and the Company’s ability and intent to hold the investment for a period of time which may be sufficient for anticipated recovery in the market. Any other than temporary loss is reported under “Interest and other income (expense), net” in the condensed consolidated statement of operations. For the three months ended March 31, 2013 and 2012, the Company has not incurred impairment loss on its investments.