Fair Value Measurements

6 Months Ended

Sep. 30, 2016

The following tables set forth by level within the fair value hierarchy our financial assets and liabilities that were accounted for at fair value on a recurring basis at September 30, 2016 and March 31, 2016:



	Balance at		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)
	September 30, 2016				Significant Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)
ASSETS
Cash and cash equivalents⁽¹⁾	$	26,246	$	26,246	$	—	$	—
Restricted cash and cash equivalents	4,458		4,458		—		—
	$	30,704	$	30,704	$	—	$	—
LIABILITIES
Contingent consideration related to acquisitions	$	20,400	$	—	$	—	$	20,400
	$	20,400	$	—	$	—	$	20,400



	Balance at		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)
	March 31, 2016				Significant Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)
ASSETS
Cash and cash equivalents ⁽¹⁾	$	27,176	$	27,176	$	—	$	—
Restricted cash and cash equivalents	5,320		5,320		—		—
Marketable securities ⁽²⁾	9,297		9,297		—		—
	$	41,793	$	41,793	$	—	$	—
LIABILITIES
Contingent consideration related to acquisitions	$	23,843	$	—	$	—	$	23,843
	$	23,843	$	—	$	—	$	23,843

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⁽¹⁾ Cash equivalents consist of money market funds.

⁽²⁾ Marketable securities consist of available-for-sale money market instruments and fixed-income securities, including certificates of deposit, corporate bonds and notes, and municipal securities.

The contingent consideration liability as of September 30, 2016 relates to the acquisition of HealthFusion (see Note 3). We assess the fair value of our contingent consideration liability on a recurring basis and any adjustments to fair value subsequent to the measurement period are reflected in the consolidated statements of comprehensive income. Key assumptions include discount rates and probability-adjusted achievement estimates of certain revenue targets that are not observable in the market. The categorization of the framework used to measure fair value of the contingent consideration liability is considered Level 3 due to the subjective nature of the unobservable inputs used.

The following table presents activity in our financial assets and liabilities measured at fair value using significant unobservable inputs (Level 3), as of and for the six months ended September 30, 2016:



	Total Liabilities
Balance at April 1, 2016	$	23,843
Settlement of contingent consideration related to Mirth	(9,273		)
Fair value adjustments	5,830
Balance at September 30, 2016	$	20,400

During the six months ended September 30, 2016, we issued shares of common stock to settle $9,273 in contingent consideration liabilities related to the acquisition Mirth. We also recorded $5,830, of which $5,400 was related to HealthFusion and $430 was related to Mirth, of fair value adjustments to contingent consideration liabilities, which are included as a component of selling, general and administrative expense.

Non-Recurring Fair Value Measurements

We have certain assets, including goodwill and other intangible assets, which are measured at fair value on a non-recurring basis and are adjusted to fair value only if an impairment charge is recognized. The categorization of the framework used to measure fair value of the assets is considered Level 3 due to the subjective nature of the unobservable inputs used. During the three and six months ended September 30, 2016, we recorded a $282 adjustment to HealthFusion goodwill related to a final working capital adjustment calculated pursuant to the HealthFusion merger agreement. There were no other adjustments to fair value of such assets.

- 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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