Adobe 2012 Annual Report Download - page 95

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The fair value of our financial assets and liabilities at December 2, 2011 was determined using the following inputs (in
thousands):
Fair Value Measurements at Reporting Date Using
Quoted Prices
in Active
Markets for
Identical Assets
Significant
Other
Observable
Inputs
Significant
Unobservable
Inputs
Total (Level 1) (Level 2) (Level 3)
Assets:
Cash equivalents:
Commercial paper ................................................ $ 15,948 $ — $ 15,948 $ —
Money market mutual funds and repurchase
agreements........................................................ 687,152 687,152 — —
Time deposits ....................................................... 15,694 15,694 — —
U.S. agency securities .......................................... 2,500 — 2,500 —
U.S. Treasury securities........................................ 7,000 — 7,000 —
Short-term investments:
Corporate bonds and commercial paper............... 1,111,537 — 1,111,537 —
Foreign government securities ............................. 7,323 — 7,323 —
Marketable equity securities................................. 12,267 12,267 — —
Municipal securities ............................................. 106,355 — 106,355 —
U.S. agency securities .......................................... 375,893 — 375,893 —
U.S. Treasury securities ........................................ 308,817 — 308,817 —
Prepaid expenses and other current assets:
Foreign currency derivatives................................ 25,362 — 25,362 —
Other assets:
Deferred compensation plan assets ...................... 12,803 523 12,280 —
Total assets................................................................... $ 2,688,651 $ 715,636 $ 1,973,015 $ —
Liabilities:
Accrued expenses:
Foreign currency derivatives................................ $ 3,881 $ — $ 3,881 $ —
Total liabilities............................................................. $ 3,881 $ — $ 3,881 $ —
See Note 3 for further information regarding the fair value of our financial instruments.
Our fixed income available-for-sale securities consist of high quality, investment grade securities from diverse issuers with
a minimum credit rating of BBB and a weighted average credit rating of AA-. We value these securities based on pricing from
pricing vendors, who may use quoted prices in active markets for identical assets (Level 1 inputs) or inputs other than quoted
prices that are observable either directly or indirectly (Level 2 inputs) in determining fair value. However, we classify all of our
fixed income available-for-sale securities as having Level 2 inputs. The valuation techniques used to measure the fair value of our
financial instruments having Level 2 inputs were derived from non-binding market consensus prices that are corroborated by
observable market data, quoted market prices for similar instruments, or pricing models, such as discounted cash flow techniques.
Our procedures include controls to ensure that appropriate fair values are recorded such as comparing prices obtained from multiple
independent sources.
Our deferred compensation plan assets consist of prime money market funds and mutual funds.
Table of Contents
ADOBE SYSTEMS INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)