Quarterly report pursuant to Section 13 or 15(d)

Fair Value Measurements

v3.8.0.1
Fair Value Measurements
 3 Months Ended
Mar. 31, 2018
Fair Value Disclosures [Abstract]  
Fair Value Measurements
8. Fair Value Measurements

U.S. GAAP defines the fair value of a financial instrument as the amount that would be received from the sale of an asset in an orderly transaction between market participants at the measurement date. The Company is responsible for the determination of the value of the investment carried at fair value and the supporting methodologies and assumptions. The Company uses various pricing sources to validate the values utilized.

The degree of judgment used in measuring the fair value of financial instruments is generally inversely correlated with the level of observable valuation inputs. Financial instruments with quoted prices in active markets generally have more pricing observability and less judgment is used in measuring fair value. Financial instruments for which no quoted prices are available have less observability and are measured at fair value using valuation models or other pricing techniques that require more judgment.

Assets recorded at fair value are measured and classified in accordance with a fair value hierarchy consisting of the three “levels” based on the observability of inputs available in the marketplace used to measure the fair values as discussed below:

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2: Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability; or

Level 3: Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.

Investment in marketable securities, available-for-sale and assets held in the rabbi trust are carried at fair value based on observable inputs available. All these securities are measured as Levels 1 or 2 as appropriate. The Company has no investments measured as Level 3.

Recurring Fair Value Measurements

The Company values its investments including assets held in rabbi trust, commercial paper, money market funds and investments in marketable securities, available-for-sale at fair value on a recurring basis. Fair values were determined for each individual security in the investment portfolio.

 

Assets carried at fair value are categorized into one of the three categories described above and consisted of the following (in thousands):

 

     March 31, 2018      December 31, 2017  
     Fair Value      Level 1      Level 2      Level 3      Fair Value      Level 1      Level 2      Level 3  

Assets held in rabbi trust

    $ 8,756      $ —        $ 8,756      $ —        $ 8,787      $ —        $ 8,787      $ —    
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Cash equivalents (1):

                        

Commercial paper

    $ 7,945      $ —        $ 7,945      $ —        $ 11,441      $ —        $ 11,441      $ —    

Money market funds

      165,027        165,027        —          —          157,788        157,788        —          —    
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
   $ 172,972      $ 165,027      $ 7,945      $ —        $ 169,229      $ 157,788      $ 11,441      $ —    
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Marketable securities, available-for-sale:

                        

Short-term investments:

                        

U.S. treasuries

    $ 72,173      $ 72,173      $ —        $ —        $ 57,624      $ 57,624      $ —        $ —    

U.S. government sponsored entities

      10,501        —          10,501        —          7,008        —          7,008        —    

Corporate debt securities

      12,152        —          12,152        —          8,928        —          8,928        —    
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
   $ 94,826      $ 72,173      $ 22,653      $ —        $ 73,560      $ 57,624      $ 15,936      $ —    
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Long-term investments:

                        

U.S. treasuries

    $ 4,393      $ 4,393      $ —        $ —        $ 17,954      $ 17,954      $ —        $ —    

U.S. government sponsored entities

      1,670        —          1,670        —          5,244        —          5,244        —    

Corporate debt securities

      23,056        —          23,056        —          22,719        —          22,719        —    

Asset-backed securities and other

      6,454        —          6,454        —          6,182        —          6,182        —    
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
   $ 35,573      $ 4,393      $ 31,180      $ —        $ 52,099      $ 17,954      $ 34,145      $ —    
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

 

(1)  Included in cash and cash equivalents.

There were no transfers in or out of Level 1 and Level 2 during the three months ended March 31, 2018.