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Marketable Investments | 12 Months Ended
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Dec. 31, 2012
Marketable Investments [Abstract] |
Marketable Investments |
(4) | Marketable Investments
The following table summarizes the Company’s marketable investments (in thousands):
|  | Amortized Cost |  |  | Gross Unrealized Gains |  |  | Gross Unrealized Losses |  |  | Market Value |
December 31, 2012 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Available-for-sale securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
State and municipal obligations |  | $ | 18,859 |  |  | $ | 27 |  |  | $ | (14 | ) |  | $ | 18,872 |
Federal agency and corporate obligations |  |  | 115,653 |  |  |  | 380 |  |  |  | (29 | ) |  |  | 116,004 |
Total short-term available-for-sale securities |  |  | 134,512 |  |  |  | 407 |  |  |  | (43 | ) |  |  | 134,876 |
ARS, long-term |  |  | 11,000 |  |  |  | — |  |  |  | (2,030 | ) |  |  | 8,970 |
Total available-for-sale securities |  | $ | 145,512 |  |  | $ | 407 |  |  | $ | (2,073 | ) |  | $ | 143,846 |
|  | Amortized Cost |  |  | Gross Unrealized Gains |  |  | Gross Unrealized Losses |  |  | Market Value |
December 31, 2011 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Available-for-sale securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
State and municipal obligations |  | $ | 9,485 |  |  | $ | 9 |  |  | $ | (12 | ) |  | $ | 9,482 |
Federal agency and corporate obligations |  |  | 127,717 |  |  |  | 127 |  |  |  | (335 | ) |  |  | 127,509 |
Total short-term available-for-sale securities |  |  | 137,202 |  |  |  | 136 |  |  |  | (347 | ) |  |  | 136,991 |
ARS, long-term |  |  | 11,000 |  |  |  | — |  |  |  | (1,435 | ) |  |  | 9,565 |
Total available-for-sale securities |  | $ | 148,202 |  |  | $ | 136 |  |  | $ | (1,782 | ) |  | $ | 146,556 |
The following table summarizes the maturity periods of the marketable securities in the Company’s portfolio as of December 31, 2012. In February 2008, certain ARS that Forrester held experienced failed auctions that limited the liquidity of these securities. These auction failures have continued throughout 2012 and based on current market conditions, it is likely that auction failures will continue. The following table reflects the ARS at their contractual maturity dates of between 2024 and 2034 (in thousands).
|  | FY 2013 |  |  | FY2014 |  |  | FY2015 |  |  | Thereafter |  |  | Total |
Federal agency and corporate obligations |  | $ | 50,403 |  |  | $ | 44,727 |  |  | $ | 20,874 |  |  | $ | — |  |  | $ | 116,004 |
State and municipal obligations |  |  | 6,421 |  |  |  | 10,326 |  |  |  | 2,125 |  |  |  | — |  |  |  | 18,872 |
ARS |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 8,970 |  |  |  | 8,970 |
Total short and long-term |  | $ | 56,824 |  |  | $ | 55,053 |  |  | $ | 22,999 |  |  | $ | 8,970 |  |  | $ | 143,846 |
The following table shows the gross unrealized losses and market value of Forrester’s available-for-sale securities with unrealized losses that are not deemed to be other-than-temporary, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position (in thousands):
|  | As of December 31, 2012 |
|  | Less Than 12 Months |  |  | 12 Months or Greater |
|  | Market Value |  |  | Unrealized Losses |  |  | Market Value |  |  | Unrealized Losses |
State and municipal bonds |  | $ | 9,430 |  |  | $ | 14 |  |  | $ | — |  |  | $ | — |
Federal agency and corporate obligations |  |  | 17,716 |  |  |  | 29 |  |  |  | — |  |  |  | — |
ARS |  |  | — |  |  |  | — |  |  |  | 8,970 |  |  |  | 2,030 |
Total |  | $ | 27,146 |  |  | $ | 43 |  |  | $ | 8,970 |  |  | $ | 2,030 |
|  | As of December 31, 2011 |
|  | Less Than 12 Months |  |  | 12 Months or Greater |
|  | Market Value |  |  | Unrealized Losses |  |  | Market Value |  |  | Unrealized Losses |
State and municipal bonds |  | $ | 2,763 |  |  | $ | 9 |  |  | $ | 1,107 |  |  | $ | 3 |
Federal agency and corporate obligations |  |  | 68,962 |  |  |  | 313 |  |  |  | 2,043 |  |  |  | 22 |
ARS |  |  | — |  |  |  | — |  |  |  | 9,565 |  |  |  | 1,435 |
Total |  | $ | 71,725 |  |  | $ | 322 |  |  | $ | 12,715 |  |  | $ | 1,460 |
The Company holds ARS with a fair value of $9.0 million and a par value of $11.0 million at December 31, 2012. These ARS will continue to be held as available-for-sale and are classified as a long-term asset in the Consolidated Balance Sheet. The Company intends to retain its investment in these ARS until the earlier of an anticipated recovery in market value or maturity and as a result has not recorded an other-than-temporary loss on these ARS. Realized gains or losses on sales of the Company’s federal obligations, state and municipal bonds and corporate bonds were not significant for the years ended December 31, 2012, 2011 or 2010. The following table represents the Company’s fair value hierarchy for its financial assets (cash equivalents and marketable investments) measured at fair value on a recurring basis (in thousands):
|  | As of December 31, 2012 |
|  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Money market funds (1) |  | $ | 815 |  |  | $ | — |  |  | $ | — |  |  | $ | 815 |
State and municipal obligations |  |  | — |  |  |  | 18,872 |  |  |  | — |  |  |  | 18,872 |
Federal agency and corporate obligations (2) |  |  | — |  |  |  | 148,117 |  |  |  | — |  |  |  | 148,117 |
ARS |  |  | — |  |  |  | — |  |  |  | 8,970 |  |  |  | 8,970 |
Total |  | $ | 815 |  |  | $ | 166,989 |  |  | $ | 8,970 |  |  | $ | 176,774 |
|  | As of December 31, 2011 |
|  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Money market funds (1) |  | $ | 5,786 |  |  | $ | — |  |  | $ | — |  |  | $ | 5,786 |
State and municipal obligations |  |  | — |  |  |  | 9,482 |  |  |  | — |  |  |  | 9,482 |
Federal agency and corporate obligations (2) |  |  | — |  |  |  | 128,509 |  |  |  | — |  |  |  | 128,509 |
ARS |  |  | — |  |  |  | — |  |  |  | 9,565 |  |  |  | 9,565 |
Total |  | $ | 5,786 |  |  | $ | 137,991 |  |  | $ | 9,565 |  |  | $ | 153,342 |
(1) | Included in cash and cash equivalents.
(2) | $32.1 million and $1.0 million included in cash and cash equivalents at December 31, 2012 and 2011, respectively, as original maturities at the time of purchase were 90 days or less.
Level 2 assets consist of the Company’s entire portfolio of federal, state, municipal and corporate bonds, excluding those municipal bonds described below with an auction reset feature. Level 2 assets have been initially valued at the transaction price and subsequently valued, at the end of each reporting period, typically utilizing third party pricing services or other market observable data. The pricing services utilize industry standard valuation methods, including both income and market based approaches and observable market inputs to determine value. These observable market inputs include reportable trades, benchmark yields, credit spreads, broker/dealer quotes, bids, offers, current spot rates and other industry and economic events. Level 3 assets at December 31, 2012 and 2011 consist entirely of municipal bonds with an auction reset feature (ARS). Prior to 2008, the fair value of the ARS investments approximated par value due to the frequent resets through the auction process. While the Company continues to receive interest income on its ARS investments at each interest reset date (which occurs at either seven or 35 day intervals for each security), these investments trade infrequently and therefore do not have a readily determinable market value. Interest rates on the securities ranged from 0.1% to 0.5% and 0.1% to 0.6% during the years ended December 31, 2012 and 2011, respectively. The Company values the ARS using a discounted cash flow model that includes unobservable inputs including estimates of interest rates, discount rates and expected holding periods of the securities, which is considered a Level 3 valuation. Unobservable inputs included in the valuation as of December 31, 2012 include a weighted average interest rate of 0.9%, a weighted average discount rate of 3.9%, and a weighted average holding period of 8.7 years. The valuation resulted in an unrealized loss recorded in accumulated other comprehensive income (loss) in the Consolidated Balance Sheets of $2.0 million at December 31, 2012 and $1.4 million at December 31, 2011. The Company believes that the loss is temporary due to the strong underlying credit rating of the securities and the fact that the Company does not intend to sell the securities and is not likely to be required to sell the securities. The assumptions used in valuing the ARS are volatile and subject to change as the underlying sources of these assumptions and market conditions change. Significant increases or decreases in any of the valuation assumptions in isolation would result in a significant change in the fair value. The following table provides a summary of changes in fair value of the Company’s Level 3 financial assets for the years ended December 31, 2012 and 2011 (in thousands):
|  | ARS |
Balance at December 31, 2010 |  | $ | 9,117 |
Sales |  |  | — |
Gains included in accumulated other comprehensive income (loss) |  |  | 448 |
Balance at December 31, 2011 |  |  | 9,565 |
Sales |  |  | — |
Losses included in accumulated other comprehensive income (loss) |  |  | (595 | )
Balance at December 31, 2012 |  | $ | 8,970 |

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- Definition Tabular disclosure of marketable securities. This may consist of investments in certain debt and equity securities, short-term investments and other assets. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 50 -Paragraph 5 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=6872113&loc=d3e27232-111563 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.2,12) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 45 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6871852&loc=d3e26626-111562 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6872113&loc=d3e27161-111563 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 45 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6871852&loc=d3e26610-111562 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 210 -Section S99 -Paragraph 1 -Subparagraph (SX 210.9-03.4) -URI http://asc.fasb.org/extlink&oid=6876686&loc=d3e534808-122878 + Details
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