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Fair Value Measurements
12 Months Ended
Dec. 31, 2019
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
Financial Assets and Liabilities that are Measured at Fair Value on a Recurring Basis
The following table summarizes the financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2019 (in thousands):
 
Quoted Prices in
Active Markets
for Identical
Assets (Level 1)
 
Significant Other
Observable
Inputs (Level 2)
 
Unobservable Inputs (Level 3)
Assets:
 
 
 
 
 
Money market instruments
$
15,933

 
$

 
$

Treasury bills

 
309,248

 
 
Corporate bonds

 
212,098

 

Asset-backed securities

 
113,083

 

Sovereign bonds

 
22,299

 

Municipal bonds

 
6,952

 
 
Agency bonds

 
5,914

 

Certificate of deposit

 
4,328

 

Economic hedge forward contracts

 
857

 

Liabilities:
 
 
 
 
 
Economic hedge forward contracts

 
23

 

Contingent consideration liabilities

 

 
1,153



The Company’s money market instruments are reported at fair value based upon the daily market price for identical assets in active markets, and are therefore classified as Level 1.
The Company’s debt securities and forward contracts are reported at fair value based upon model-driven valuations in which all significant inputs are observable or can be derived from or corroborated by observable market data for substantially the full term of the asset or liability, and are therefore classified as Level 2. Management is responsible for estimating the fair value of these financial assets and liabilities, and in doing so, considers valuations provided by a large, third-party pricing service. For debt securities, this service maintains regular contact with market makers, brokers, dealers, and analysts to gather information on market movement, direction, trends, and other specific data. They use this information to structure yield curves for various types of debt securities and arrive at the daily valuations. The Company's forward contracts are typically traded or executed in over-the-counter markets with a high degree of pricing transparency. The market participants are generally large commercial banks. The Company's certificate of deposit is valued at cost, which approximates fair value given its short term to maturity.
The Company did not record an other-than-temporary impairment of these financial assets in 2019, 2018, or 2017.
The Company's contingent consideration liabilities are reported at fair value based upon probability-adjusted present values of the consideration expected to be paid, using significant inputs that are not observable in the market, and are therefore classified as Level 3. Key assumptions used in these estimates include probability assessments with respect to the likelihood of achieving certain revenue milestones. The fair values of these contingent consideration liabilities were calculated using discount rates consistent with the level of risk of achievement, and are remeasured each reporting period with changes in fair value recorded in "Other income (expense)" on the Consolidated Statements of Operations.
The following table summarizes the activity for the Company's liabilities measured at fair value using Level 3 inputs (in thousands):
Balance as of December 31, 2017
$
3,557

Payment of GVi contingent consideration
(1,000
)
Fair value adjustment to GVi contingent consideration
1,065

Fair value adjustment to Manatee contingent consideration
(1,350
)
Fair value adjustment to Chiaro contingent consideration
282

Balance as of December 31, 2018
2,554

Fair value adjustment to GVi contingent consideration
(1,646
)
Fair value adjustment to Chiaro contingent consideration
245

Balance as of December 31, 2019
$
1,153


The contingent consideration liability as of December 31, 2019 in the amount of $1,153,000 relates to the Company's acquisition of Chiaro Techologies, LLC in 2016. The undiscounted potential outcomes related to the contingent consideration range from $0 to $1,250,000 based upon certain milestone revenue levels to be paid in 2020 if earned.
Non-financial Assets that are Measured at Fair Value on a Non-recurring Basis
Non-financial assets such as property, plant, and equipment, goodwill, and intangible assets are required to be measured at fair value only when an impairment loss is recognized. In 2017, the Company determined that the carrying value of the customer relationships arising from the acquisition of AQSense, S.L. was impaired and reduced this value to zero, resulting in an impairment charge of $469,000. The Company did not record an impairment charge related to non-financial assets in 2019 or 2018.
Refer to Note 21 to the Consolidated Financial Statements for further information regarding acquisitions.