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Marketable Securities and Fair Value Measurements

9 Months Ended

Sep. 30, 2020

MARKETABLE SECURITIES AND FAIR VALUE MEASUREMENTS

Marketable Securities

As of September 30, 2020 and December 31, 2019, all of our marketable securities are classified as available-for-sale, have contractual maturities of one year or less and consist of the following:


	Cost		Unrealized Gain (Loss)		Fair Value
Short-term marketable securities:
As of September 30, 2020:
Corporate debt securities	$	737	$	(2)	$	735


	$	737	$	(2)	$	735

As of December 31, 2019:
Commercial paper	$	2,487	$	—	$	2,487
U.S. government treasury bills	2,249		1		2,250
Corporate debt securities	2,236		2		2,238
	$	6,972	$	3	$	6,975

Unrealized holding gains and losses are recorded in accumulated other comprehensive income, a component of shareholders’ equity, in the condensed consolidated balance sheets.

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Three levels of inputs may be used to measure fair value:

Level 1:Valuations based on quoted prices in active markets for identical assets and liabilities.

Level 2:Valuations based on inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3:Valuations based on unobservable inputs in which there is little or no market data available, which require the reporting entity to develop its own assumptions.

The following table presents information about our assets measured at fair value on a recurring basis in the condensed consolidated balance sheets as of September 30, 2020 and December 31, 2019:


	Level 1		Level 2		Level 3		Total
As of September 30, 2020:
Assets:
Cash equivalents:
Money market funds	$	9,427	$	—	$	—	$	9,427


Short-term marketable securities:

Corporate debt securities	—		735		—		735


As of December 31, 2019:
Assets:
Cash equivalents:
Money market funds	$	1,307	$	—	$	—	$	1,307


Short-term marketable securities:
U.S. government treasury bills	2,250		—		—		2,250
Commercial paper	—		2,487		—		2,487
Corporate debt securities	—		2,238		—		2,238

We primarily use the market approach to determine the fair value of our financial assets. The fair value of our current assets and liabilities, including accounts receivable and accounts payable approximates the carrying value due to the short-term nature of these balances. We have currently chosen not to elect the fair value option for any items that are not already required to be measured at fair value in accordance with U.S. GAAP.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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