Crucial 2012 Annual Report Download - page 76

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Fair Value Measurements on a Recurring Basis
All marketable debt and equity investments are classified as available-for-sale and are carried at fair value. Assets
measured at fair value on a recurring basis were as follows:
As of 2012 2011
Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total
Cash equivalents:
Money market funds $ 2,159 $ — $ — $ 2,159 $ 1,462 $ — $ — $ 1,462
Commercial paper — 29 — 29 — — — —
Certificates of deposit — 27 — 27 — 155 — 155
Government securities — 5 — 5 — — — —
2,159 61 — 2,220 1,462 155 — 1,617
Short-term investments:
Government securities — 51 — 51 — — — —
Corporate bonds — 31 — 31 — — — —
Commercial paper — 10 — 10 — — — —
Asset-backed securities — 4 — 4 — — — —
Certificates of deposit — 4 — 4 — — — —
— 100 — 100 — — — —
Long-term marketable
investments:
Corporate bonds — 203 — 203 — — — —
Government securities — 88 — 88 — — — —
Asset-backed securities — 73 — 73 — — — —
Marketable equity
securities 5 5 — 10 37 15 — 52
5 369 — 374 37 15 — 52
Noncurrent assets:
Assets held for sale — — 25 25 — — 35 35
— — 25 25 — — 35 35
$ 2,164 $ 530 $ 25 $ 2,719 $ 1,499 $ 170 $ 35 $ 1,704
Government securities consist of securities issued directly by or deemed to be guaranteed by government entities such as
U.S and non U.S. agency securities, government bonds and treasury securities. Level 2 securities are valued using information
obtained from pricing services, which obtain quoted market prices for similar instruments, non-binding market consensus
prices that are corroborated by observable market data, or various other methodologies, to determine the appropriate value at
the measurement date. We periodically perform supplemental analysis to validate information obtained from our pricing
services. As of August 30, 2012, no adjustments were made to such pricing information.
Level 3 assets consisted primarily of semiconductor equipment and facilities classified as held for sale. Fair value for
semiconductor equipment was based on quotations obtained from equipment dealers, which consider the remaining useful life
and configuration of the equipment. Fair value for facilities was determined based on sales of similar facilities and properties
in comparable markets. Losses recognized in 2012 and 2011 due to fair value measurements using Level 3 inputs were not
significant. For 2012, activity of assets held for sale was not significant.
Marketable equity securities included approximately 1.3 million ordinary shares (subsequent to a 1 for 15 reverse stock
split on August 6, 2012) of Tower Semiconductor Ltd. ("Tower") received in connection with our sale of our wafer fabrication
facility in Japan in June 2011. As of September 1, 2011, the shares were valued using quoted market prices in an active market
and discounted using a protective put model for our resale restriction (Level 2). During 2012, the resale restrictions lapsed for
0.7 million of the shares, which were valued using quoted market prices (Level 1) as of August 30, 2012.