Quarterly report pursuant to Section 13 or 15(d)

Fair Value Measurements (Tables)

v3.20.1
Fair Value Measurements (Tables)
 3 Months Ended
Mar. 31, 2020
Fair Value Disclosures [Abstract]  
Schedule of Assets and liabilities at Fair Value on Recurring Basis
Assets and liabilities carried at fair value on a recurring basis consisted of the following (in thousands):
                                                                 
 
March 31, 2020
   
December 31, 2019
 
 
Fair Value
   
Level 1
   
Level 2
   
Level 3
   
Fair Value
   
Level 1
   
Level 2
   
Level 3
 
Assets:
 
 
 
  
 
 
  
 
 
  
 
 
  
 
 
  
 
 
  
 
 
  
 
 
Assets held in rabbi trust
  $
7,992
    $
—  
     $
7,992
    $
—  
     $
9,452
    $
—  
     $
9,452
    $
—  
  
                                                                 
Cash equivalents
(1)
:
   
     
     
     
     
     
     
     
 
Commercial paper and other
  $
9,498
    $
—  
     $
9,498
    $
—  
     $
5,087
    $
—  
     $
5,087
    $
—  
  
Money market funds
   
146,769
     
146,769
     
—  
      
—  
      
185,513
     
185,513
     
—  
      
—  
  
                                                                 
  $
156,267
    $
146,769
    $
9,498
    $
—  
     $
190,600
    $
185,513
    $
5,087
    $
—  
  
                                                                 
Marketable debt securities,
available-for-sale:
   
     
     
     
     
     
     
     
 
Short-term investments:
   
     
     
     
     
     
     
     
 
U.S. treasuries
  $
114,720
    $
114,720
    $
—  
     $
—  
     $
124,580
    $
124,580
    $
—  
     $
—  
  
U.S. government sponsored entities
   
9,137
     
—  
      
9,137
     
—  
      
—  
      
—  
      
—  
      
—  
  
Corporate debt
   
19,711
     
—  
      
19,711
     
—  
      
26,172
     
—  
      
26,172
     
—  
  
ABS and other
   
296
     
—  
      
296
     
—  
      
—  
      
—  
      
—  
      
—  
  
                                                                 
  $
143,864
    $
114,720
    $
29,144
    $
—  
     $
150,752
    $
124,580
    $
26,172
    $
—  
  
                                                                 
Long-term investments:
    
     
     
     
     
     
     
     
 
U.S. treasuries
  $
10,510
    $
10,510
    $
—  
     $
—  
     $
24,423
    $
24,423
    $
—  
     $
—  
  
U.S. government sponsored entities
   
1,328
     
—  
      
1,328
     
—  
      
1,355
     
—  
      
1,355
     
—  
  
Corporate debt
   
25,606
     
—  
      
25,606
     
—  
      
26,471
     
—  
      
26,471
     
—  
  
ABS and other
   
7,766
     
—  
      
7,766
     
—  
      
8,560
     
—  
      
8,560
     
—  
  
                                                                 
  $
45,210
    $
10,510
    $
34,700
    $
—  
     $
60,809
    $
24,423
    $
36,386
    $
—  
  
                                                                 
Liabilities:
 
 
 
  
 
 
  
 
 
  
 
 
  
 
 
  
 
 
  
 
 
  
 
 
Contingent consideration
  $
3,162
    $
—  
     $
—  
     $
 
3,162
    $
3,387
     $
—  
     $
—  
     $
3,387
  
                                                                 
Deferred compensation liability
  $
7,244
    $
7,244
    $
—  
     $
—  
     $
 
 
 
 
 
 
8,241
    $
8,241
    $
 
 
 
 
 
 
—  
     $
 
 
 
 
 
—  
  
                                                                 
 
 
 
 
 
 
 
 
 
 
 
(1)
Included in cash and cash equivalents on the accompanying condensed consolidated balance sheets.
 
 
 
 
 
 
 
 
 
 
 
Schedule of Reconciliation of Contingent Consideration Measured at Fair Value on Recurring Basis Assuming the achievement of the applicable performance criteria and/or service and time requirements, the Company anticipates these
earn-out
payments will be made over the next one to seven-year period. Changes in fair value are included in selling, general and administrative expense in the condensed consolidated statements of net and comprehensive income. A reconciliation of contingent consideration measured at fair value on a recurring basis consisted of the following (in thousands):
 
Three Months Ended
March 31,
 
 
2020
   
2019
 
Beginning balance
(1)
   $
 
 
3,387
    $
2,875
 
Contingent consideration in connection with acquisitions
(2)
    
—  
      
—  
  
Change in fair value of contingent consideration
   
(225
 )    
48
 
Payments of contingent consideration
   
—  
      
—  
  
                 
Ending balance
  $
3,162
    $
 
 
2,923
 
                 
(1)
 Beginning balance for 2020 reflects the reclassification of $1,401 from contingent consideration related to deferred consideration. See Note 7 – “Selected Balance Sheet Data – Other Liabilities” for additional information.
(2)
Contingent consideration in connections with acquisitions represents a noncash investing activity.
Fair Value Liabilities Measured On Recurring Basis Valuation Techniques
 
Fair Value at
March 31, 2020
 
 
Valuation Technique
 
Unobservable inputs
 
Range (Weighted Average)
(1)
 
Contingent consideration
 
$
3,162
 
 
Discounted cash flow
 
Expected life of cash flows
 
 
0.2-5.5
 years (2.1 years)
 
 
 
 
 
 
Discount rate
 
 
6.7%-6.9%
 (6.8%)
 
 
 
 
 
 
Probability of achievement
 
 
33.0%-100.0%
 (74.0%)
 
 
 
 
 
 
 
 
 
 
 
 
 
Fair Value at
December 31, 2019
 
 
Valuation Technique
 
Unobservable inputs
 
Range (Weighted Average)
(1)
 
Contingent consideration
 
$
3,387
 
 
Discounted cash flow
 
Expected life of cash flows
 
 
0.4-5.8
 years (2.4 years)
 
 
 
 
 
 
Discount rate
 
 
3.6%-4.9%
 (4.1%)
 
 
 
 
 
 
Probability of achievement
 
 
33.0%-100.0%
 (74.3%)
 
(1)
Unobservable inputs were weighted by the relative fair value of the instruments.
Fair Value Liabilities Measured On NonRecurring Basis Valuation Techniques
 
Fair Value at 
March 31, 2020
 
 
Valuation Technique
 
Unobservable inputs
 
Range (Weighted
Average)
(1)
 
MSRs
 
$
2,125
 
 
Discounted cash flow
 
Constant prepayment rates
 
 
0.0%-20.0%
 (10.0%)
 
 
 
 
 
 
Constant default rate
 
 
1.5%-1.5%
(1.5%)
 
 
 
 
 
 
Loss severity
 
 
30.2%-30.2%
 (30.2%)
 
 
 
 
 
 
Discount rate
 
 
10.0%-10.0%
(10.0%)
 
 
Fair Value at
December 31, 2019
 
 
Valuation Technique
 
Unobservable inputs
 
Range (Weighted
Average)
(1)
 
MSRs
 
$
2,204
 
 
Discounted cash flow
 
Constant prepayment rates
 
 
0.0%-20.0%
 (10.0%)
 
 
 
 
 
 
Constant default rate
 
 
2.0%-2.0%
 (2.0%)
 
 
 
 
 
 
Loss severity
 
 
40.0%-40.0%
 (40.0%)
 
 
 
 
 
 
Discount rate
 
 
9.5%-9.7%
 (9.7%)
 
(1)
Weighted average is based on the 10% constant prepayment rate scenario which the Company uses as the reported fair value.