Note 4. Fair Value Measurements

The authoritative guidance on fair value measurements establishes a framework with respect to measuring assets and liabilities at fair value on a recurring basis and non-recurring basis. Under the framework, fair value is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants, as of the measurement date. The framework also establishes a three-tier hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of our Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors market participants would use in valuing the asset or liability and are developed based on the best information available in the circumstances. The hierarchy consists of the following three levels:

Level 1:

Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date.

Level 2:

Inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3:

Inputs are unobservable inputs for the asset or liability.

The following table presents information about our financial assets measured at fair value on a recurring basis, based on the three-tier fair value hierarchy:

	September 30, 2018
	Total		Level 1		Level 2		Level 3
	(in thousands)
Marketable securities:
Money market accounts	$	4,726	$	4,726	$	—	$	—
Commercial paper		899		—		899		—
Corporate debt securities		27,465		—		27,465		—
Total marketable securities	$	33,090	$	4,726	$	28,364	$	—

	December 31, 2017
	Total		Level 1		Level 2		Level 3
	(in thousands)
Marketable securities:
Money market accounts	$	723	$	723	$	—	$	—
Corporate debt securities		34,877		—		34,877		—
Total marketable securities	$	35,600	$	723	$	34,877	$	—

The Company’s Level 1 assets include money market instruments and are valued based upon observable market prices. Level 2 assets consist of commercial paper and corporate debt securities. Level 2 securities are valued based upon observable inputs that include reported trades, broker/dealer quotes, bids and offers. As of September 30, 2018, the Company had no investments that were measured using unobservable (Level 3) inputs.

There were no transfers between fair value measurement levels during the nine months ended September 30, 2018.

Gross unrealized gains or losses for cash equivalents and marketable securities as of September 30, 2018 were not material. As of September 30, 2018, unrealized losses for securities in an unrealized loss position for more than 12 months were $100,000. During the nine months ended September 30, 2018, the Company did not recognize other-than-temporary impairment losses related to its marketable securities.