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• Level 2 — Inputs other than quoted prices included in Level 1 that are observable for the asset or
liability, either directly or indirectly; and
• Level 3 — Unobservable inputs used in valuations in which there is little market activity for the asset
or liability at the measurement date.
Fair value measurements of assets and liabilities are assigned a level within the fair value hierarchy based
on the lowest level of any input that is significant to the fair value measurement in its entirety.
Assets and (Liabilities) Measured at Fair Value on a Recurring Basis
Fair Value at
December 31,
2008
Quoted
Prices in
Active
Markets
(Level 1)
Other
Observable
Inputs
(Level 2)
Unobservable
Inputs
(Level 3)
Based on
Assets measured at fair value on a
recurring basis:
Available-for-sale marketable securities — ST. . . $694.1 $428.0 $264.7 $ 1.4
Available-for-sale marketable securities — LT. . 24.7 — — 24.7
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $718.8 $428.0 $264.7 $26.1
(Liabilities) measured at fair value on a
recurring basis:
Foreign currency derivatives
(1)
. . . . . . . . . . . . . (1.5) — (1.5) —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (1.5) $ — $ (1.5) $ —
(1)
Foreign currency derivative liabilities are included in Accrued liabilities on the Consolidated Statements of Financial Position.
Excluded from the table above were financial instruments included in Cash and cash equivalents on the
Consolidated Statements of Financial Position. The Company’s policy is to consider all highly liquid
investments with an original maturity of three months or less at the Company’s date of purchase to be a
cash equivalent. Investments considered cash equivalents, which closely approximate fair value as
described in the Company’s policy above, included roughly $129.9 million of money market funds and
$36.0 million of US agency discount notes at December 31, 2008.
The following table presents additional information about Level 3 assets measured at fair value on a
recurring basis for the year ended December 31, 2008:
Twelve Months
Ended
December 31, 2008
Available-for-sale marketable securities
Balance, beginning of period. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $31.9
Realized and unrealized gains/(losses) included in earnings . . . . . . . . . . . . . . . . . (7.3)
Unrealized gains/(losses) included in comprehensive income . . . . . . . . . . . . . . . . (1.0)
Purchases, issuances, and settlements, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.1
Transfers in and/or out of Level 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4
Balance, end of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $26.1
Realized and unrealized losses of $7.3 million during 2008 were included in Other (income) expense, net
on the Consolidated Statements of Earnings. Of this amount, losses of $7.3 million were attributable to the
change in fair value of marketable securities held at December 31, 2008, deemed to be other than
temporarily impaired, including $4.4 million related to the Lehman Brothers bankruptcy, $1.9 million related
to auction rate securities, and $1.0 related to distressed corporate debt, mortgage-backed and asset-
backed securities.
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