v2.3.0.15
Fair Value Measurements
3 Months Ended
Sep. 30, 2011
Fair Value Measurements [Abstract] 
Fair Value Measurements

Note 16 – Fair Value Measurements

Financial instruments held by the Company include corporate bonds, U.S. government securities, and money market funds. The Company measures certain financial assets at fair value on a recurring basis, including cash equivalents and available-for-sale securities. The fair value of these financial assets was determined based on observable and unobservable inputs.

 

Observable inputs consist of market data obtained from independent sources while unobservable inputs reflect the Company’s own market assumptions. These inputs create the following fair value hierarchy:

 

  •  

Level 1 – Quoted prices in active markets for identical assets or liabilities

 

  •  

Level 2 – Valuations based on quoted prices in markets that are not active, quoted prices for similar assets or liabilities or all other inputs that are observable

 

  •  

Level 3 – Unobservable inputs for which there is little or no market data which require the Company to develop its own assumptions

If the inputs used to measure the fair value of a financial instrument fall within different levels of the hierarchy, the financial instrument is categorized based upon the lowest level input that is significant to the fair value measurement.

Whenever possible, the Company uses quoted market prices to determine fair value. In the absence of quoted market prices, the Company uses independent sources and data to determine fair value. At September 30, 2011, the fair value of the Company’s investments in corporate bonds, U.S. government securities, and money market funds was determined using quoted prices in active markets. The Company calculates the fair value of its derivative assets and liabilities using Level 2 inputs of quoted currency forward rates. The fair value of the derivative instruments recorded in the Company’s Consolidated Balance Sheets as of September 30, 2011 was not significant. The carrying values of the Company’s cash, cash equivalents, short-term investments, accounts receivable and accounts payable approximate their fair values. The fair value of the Company’s convertible senior notes was estimated at $117.1 million as of September 30, 2011 using Level 2 inputs.

Information regarding the Company’s assets measured at fair value is as follows:

 

                             
    As of September 30, 2011  
    Fair Value Measurements at
Reporting Date Using		      
    Level 1     Level 2     Level 3   Total Fair Value
and Carrying
Value on our
Balance Sheet		  
    (in thousands)  

Investments in corporate bonds

   $ 62,997     $ 14,361         $ 77,358  

Investments in money market funds

     32,536                   32,536  

 

                             
    As of June 30, 2011  
    Fair Value Measurements at
Reporting Date Using		      
    Level 1     Level 2     Level 3   Total Fair Value
and Carrying
Value on our
Balance Sheet		  
    (in thousands)  

Investments in corporate bonds

   $ 87,426     $ 14,499         $ 101,925  

Investments in U.S. government securities

             1,001           1,001  

Investments in money market funds

     9,733                   9,733  

 

In addition to the items that are measured at fair value on a recurring basis, the Company also measured certain assets at fair value on a nonrecurring basis. As a result of an impairment analysis, the Company recorded an impairment loss of $34.3 million as of September 30, 2011 and $228.9 million as of June 30, 2011 to write its assets down to fair value (see Note 14, “Impairment Loss,” for additional information). The Company has determined that these fair value measurements rely primarily on Company-specific inputs and the Company’s assumptions about the use of the assets as observable inputs are not available. Accordingly, the Company determined that these fair value measurements reside primarily within Level 3 of the fair value hierarchy.

Information regarding the Company’s assets included in the United Solar Ovonic business that were measured at fair value on a nonrecurring basis is as follows:

 

                 
    As of September 30,
2011		     As of June  30,
2011		  
    Level 3     Level 3  
    (in thousands)  

Property, plant and equipment, net

   $ 59,064     $ 86,709