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Fair Value Measurements And Marketable Securities

6 Months Ended

Jun. 30, 2011

Fair Value Measurements And Marketable Securities

Fair Value Measurements And Marketable Securities

Note 3 – Fair Value Measurements and Marketable Securities

We, in accordance with U.S. GAAP, define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). Effective January 1, 2008, we elected the fair value option for certain of our marketable securities purchased since such adoption. Management initially elected the fair value option for certain of our marketable securities because it views such investment securities as highly liquid and available to be drawn upon for working capital purposes making them similar to its cash and cash equivalents. Accordingly, we record net unrealized gain or loss in the other income—investment and interest caption in our consolidated income statements for such investments. We have not elected the fair value option for marketable securities acquired after December 31, 2009. Although these assets continue to be highly liquid and available, we do not believe these assets are representative of our operating activities. These assets are representative of our investing activities, and they will be available for future needs of the Company to support its current and projected growth.

Certain of our assets and liabilities are reported at fair value in the accompanying balance sheets. Such assets and liabilities include cash and cash equivalents, marketable securities, accounts and notes receivable, accounts payable, income taxes payable and other accrued expenses. The following tables provide fair value measurement information for our marketable securities and deferred compensation fund investment assets as of June 30, 2011 and December 31, 2010.

		As of June 30, 2011
										Fair Value Measurement Using:
		Carrying Amount				Total Fair Value				Quoted Prices in Active Markets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
Financial Assets
Marketable securities
Municipal bonds		$	40,782,000			$	40,782,000			$	—			$	40,782,000			$	—
Equity securities – Deferred comp fund
Money Market		$	2,698,000			$	2,698,000			$	—			$	2,698,000			$	—
Large Cap Value			2,709,000				2,709,000				2,709,000				—				—
Large Cap Growth			2,332,000				2,332,000				2,332,000				—				—
Small Cap Value			1,376,000				1,376,000				1,376,000				—				—
Fixed income			1,213,000				1,213,000				1,213,000				—				—
Speciality			833,000				833,000				833,000				—				—
International			671,000				671,000				671,000				—				—
Balanced and Lifestyle			666,000				666,000				666,000				—				—
Large Cap Blend			507,000				507,000				507,000				—				—
Mid Cap Growth			396,000				396,000				396,000				—				—
Small Cap Growth			31,000				31,000				31,000				—				—
Mid Cap Value			30,000				30,000				30,000				—				—
Equity securities – Deferred comp fund		$	13,462,000			$	13,462,000			$	10,764,000			$	2,698,000			$	—

		As of December 31, 2010
										Fair Value Measurement Using:
		Carrying Amount				Total Fair Value				Quoted Prices in Active Markets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
Financial Assets
Marketable securities
Municipal bonds		$	43,437,000			$	43,437,000			$	—			$	43,437,000			$	—
Equity securities – Deferred comp fund
Money Market		$	2,737,000			$	2,737,000			$	—			$	2,737,000			$	—
Large Cap Value			2,433,000				2,433,000				2,433,000				—				—
Large Cap Growth			2,106,000				2,106,000				2,106,000				—				—
Small Cap Value			1,152,000				1,152,000				1,152,000				—				—
Fixed Income			987,000				987,000				987,000				—				—
Specialty			712,000				712,000				712,000				—				—
Balanced and Lifestyle			566,000				566,000				566,000				—				—
International			572,000				572,000				572,000				—				—
Large Cap Blend			444,000				444,000				444,000				—				—
Mid Cap Growth			371,000				371,000				371,000				—				—
Equity securities – Deferred comp fund		$	12,080,000			$	12,080,000			$	9,343,000			$	2,737,000			$	—

The fair value of the municipal bonds is measured using pricing service data from an external provider. The fair value of equity investments in the funded deferred compensation plan are valued (Level 1) based on quoted market prices. The money market fund in the funded deferred compensation plan is valued (Level 2) at the net asset value ("NAV") of the shares held by the plan at the end of the period. As a practical expedient, fair value of our money market fund is valued at the NAV as determined by the custodian of the fund. The money market fund includes short-term United States dollar denominated money-market instruments. The money market fund can be redeemed at its NAV at its measurement date as there are no significant restrictions on the ability of participants to sell this investment.

For the three and six month periods ended June 30, 2011, the other income—investment and interest caption on our consolidated statements of income includes unrealized losses from marketable securities of $107,000 and $252,000, respectively, for investments recorded under the fair value option. For the three and six month periods ended June 30, 2010, the other income—investment and interest caption on our consolidated statements of income includes unrealized losses from marketable securities of $61,000 and $658,000, respectively, for investments recorded under the fair value option.

For the three and six month periods ended June 30, 2011, the accumulated other comprehensive income on our consolidated balance sheet and stockholders' equity includes unrealized gains from marketable securities of $285,000 and $375,000, respectively, related to marketable securities that are not recognized under the fair value option in accordance with U.S. GAAP. For the three and six month periods ended June 30, 2010, the accumulated other comprehensive income on our consolidated balance sheet and stockholders' equity includes unrealized gains from marketable securities of $92,000 and $31,000, respectively, related to marketable securities that are not recognized under the fair value option in accordance with U.S. GAAP.

		Amortized Cost				Gross Unrealized Gains				Gross Unrealized Losses				Estimated Fair Value				Other-than- temporary Impairments
June 30, 2011
Type of security:
Municipal bonds		$	10,589,000			$	316,000			$	—			$	10,905,000			$	—
Municipal bonds – available for sale			29,580,000				300,000				(3,000	)			29,877,000				—
Total debt securities		$	40,169,000			$	616,000			$	(3,000	)		$	40,782,000			$	—
December 31, 2010
Type of security:
Municipal bonds		$	18,029,000			$	568,000			$	—			$	18,597,000			$	—
Municipal bonds – available for sale			24,918,000				—				(78,000	)			24,840,000				—
Total debt securities		$	42,947,000			$	568,000			$	(78,000	)		$	43,437,000			$	—

The contractual maturities of available for sale investments held at June 30, 2011 and December 31, 2010.

		June 30, 2011				December 31, 2010
Maturing in one year or less		$	1,149,000			$	313,000
Maturing after one year through three years			21,184,000				22,325,000
Maturing after three years			7,544,000				2,202,000
Total debt securities – available for sale		$	29,877,000			$	24,840,000

X

- Definition

Tabular disclosure of the fair value measurement of assets and liabilities which includes [financial] instruments measured at fair value that are classified in stockholders' equity. Such assets and liabilities may be measured on a recurring or nonrecurring basis. The disclosures which may be required or desired include: (1) for assets and liabilities measured on a recurring basis, disclosure may include: (a) the fair value measurements at the reporting date; (b) the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets or liabilities (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3); (c) for fair value measurements using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (i) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (ii) purchases, sales, issuances, and settlements (net); (iii) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs); (d) the amount of the total gains or losses for the period in subparagraph (c) (i) above included in earnings (or changes in net assets) that are attributable to the change in unrealized gains or losses relating to those assets and liabilities still held at the reporting date and a description of where those unrealized gains or losses are reported in the statement of income (or activities); (e) the valuation technique(s) used to measure fair value and a discussion of changes in valuation techniques, if any, during the period and (2) for assets and liabilities that are measured at fair value on a nonrecurring basis (for example, impaired assets) disclosure may include, in addition to (a) above: (a) the reasons for the fair value measurements recorded; (b) the same as (b) above; (c) for fair value measurements using significant unobservable inputs (Level 3), a description of the inputs and the information used to develop the inputs; and (d) the valuation technique(s) used to measure fair value and a discussion of changes, if any, in the valuation technique(s) used to measure similar assets and/or liabilities in prior periods. Where the quoted price in an active market for the identical liability is not available, the Level 1 input is the quoted price of an identical liability when traded as an asset.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6925170&loc=d3e19279-110258

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 157
-Paragraph 32
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 157
-Paragraph 33
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 107
-Paragraph 10
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=6925170&loc=d3e19296-110258

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6925170&loc=d3e19207-110258

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 157
-Paragraph 6
-Footnote 4
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6925170&loc=d3e19190-110258

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