FAIR VALUE MEASURMENTS

12 Months Ended

Dec. 31, 2023

NOTE 18:-

FAIR VALUE MEASURMENTS

The Company measured the Holdback Amount fair value by multiplying the closing market share price of the Company in the held-back number of ordinary shares and classified it within Level 1. Hedging contracts are classified within Level 2 as the valuation inputs are based on quoted prices and market observable data of similar instruments. The Earn-Out Consideration is classified within Level 3, as this liability is valued using valuation techniques.

In 2022, the Company invested in a convertible debt of a Canadian company. The Company has elected to measure the convertible debt at fair value with changes in fair value recognized in finance income (expenses), net in the consolidated statement of income (loss). The fair value of the convertible debt is classified within Level 2 as the valuation inputs are based on quoted prices and market observable data of similar instruments. As of December 31, 2023, the fair value of the convertible debt was determined to be zero. The Company recorded income (loss) in the amounts of ($1,401) and $26 for the years ended December 31, 2023 and 2022, respectively, related to revaluation of the convertible debt.

	December 31, 2023
	Fair value measurements using input type
	Level 1		Level 2		Level 3		Total
Assets:
Derivative assets		-		680		-		680

Total financial assets	$	-	$	680	$	-	$	680

Liabilities:
Holdback Amount		795		-		-		795
Earn-Out Consideration		-		-		10,826		10,826

Total financial liabilities	$	795	$	-	$	10,826	$	11,621

	December 31, 2022
	Fair value measurements using input type
	Level 1		Level 2		Level 3		Total
Assets:
Convertible debt		-		1,401	-			1,401

Total financial assets	$	-	$	1,401	$	-	$	1,401

Liabilities:
Derivative liability		-		635		-		635

Total financial liabilities	$	-	$	635	$	-	$	635

The table below presents the changes in the Earn-Out Consideration which was classified as Level 3 and measured at fair value on a recurring basis, in the year ended December 31, 2023:

Fair value at the beginning of the year	$	-
Business combination (see Note 17)		11,163
Income from changes in fair value		(337	)
Fair value at the end of the year	$	10,826

The Company estimated the fair value of the Earn-out Consideration by utilizing a Monte Carlo simulation. The significant assumptions used in the model mainly relate to the projected revenues and adjusted EBITDA in the forecasted years, including revenue growth rate range of 12.9%-14.1% and adjusted EBITDA margin range of 11.9%-15%. Changes in the Earn-out Consideration fair value are recorded in the consolidated statements of income (loss) under Other operating expenses (income), net.

- 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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