Quarterly report pursuant to Section 13 or 15(d)

Note 14 - Fair Value Measurements

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Note 14 - Fair Value Measurements
 6 Months Ended
Dec. 31, 2011
Fair Value, Measurement Inputs, Disclosure [Table Text Block]
(14)     Fair Value Measurements

We determine fair value as the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability. The fair value is calculated based on assumptions that market participants use in pricing the asset or liability, and not on assumptions specific to the Company. In addition, the fair value of liabilities includes consideration of non-performance risk including our own credit risk. Each fair value measurement is reported in one of three levels, determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are:

 
Level 1
Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets.

 
Level 2
Inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

 
Level 3
Inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques.

The following section describes the valuation methodologies we use to measure different financial assets and liabilities at fair value.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table presents our assets and liabilities measured at fair value on a recurring basis at December 31, 2011 and June 30, 2011 (in thousands):

December 31, 2011
 
   
Level 1
   
Level 2
   
Level 3
   
Balance
 
Cash equivalents
  $ 81,754       -       -     $ 81,754  
Available-for-sale securities
    -       11,016       -       11,016  
Total
  $ 81,754     $ 11,016     $ -     $ 92,770  

June 30, 2011
 
   
Level 1
   
Level 2
   
Level 3
   
Balance
 
Cash equivalents
  $ 94,910       -       -     $ 94,910  
Available-for-sale securities
    -       12,909       -       12,909  
Total
  $ 94,910     $ 12,909     $ -     $ 107,819  

Cash equivalents consist of money market accounts and mutual funds in U.S. government and agency fixed income securities. We use quoted prices in active markets for identical assets or liabilities to determine fair value. At December 31, 2011 and June 30, 2011, $15.4 million and $16.4 million, respectively, of the cash equivalents were restricted, and classified as a long-term asset.

Available-for-sale securities consist of U.S. municipal bonds with maturities of less than two years. The municipal bonds are rated A/A1 or better by S&P/Moodys respectively. As of December 31, 2011 and December 31, 2010, there were no material gross unrealized gains or losses on available-for-sale securities.

As of December 31, 2011 and June 30, 2011, the contractual maturities of our available-for-sale investments were as follows:

December 31, 2011
 
   
Cost
   
Estimated Fair Value
 
Due in one year or less
  $ 7,590     $ 7,696  
Due after one year through five years
  $ 3,281     $ 3,320  

June 30, 2011
 
   
Cost
   
Estimated Fair Value
 
Due in one year or less
  $ 7,311     $ 7,393  
Due after one year through five years
  $ 5,428     $ 5,517  

No investments have been in a continuous loss position for more than one year, and no other-than-temporary impairments were recognized. Also see Note 4, "Restricted Cash and Investments", and Note 5, "Marketable Securities".

Assets and Liabilities Measured at Fair Value on a Non-recurring Basis

We measure certain assets at fair value on a non-recurring basis. These assets are recognized at fair value when they are deemed to be other-than-temporarily impaired. During the six month periods ended December 31, 2011 and  2010, we did not record any other-than-temporary impairments on those assets required to be measured at fair value on a non-recurring basis.