Fair Value Measurements

6 Months Ended

Jun. 30, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurements

4. Fair Value Measurements

As of June 30, 2024, the Company’s Level 3 instruments consist of contingent purchase consideration liabilities related to the acquisition of Great North (Note 3). The fair value of such earn-out liabilities is generally determined using a Monte Carlo Simulation that includes significant inputs that are not observable. Significant inputs include management’s estimate of revenue and other market inputs, including expected revenue volatility (6.7%) and a revenue discount rate (8.4%). The fair value of certain earn-out liabilities is derived using the estimated probability of success of achieving the earn-out periods discounted to present value. The fair value of contingent consideration liabilities is remeasured at each reporting period at the estimated fair value based on the inputs on the date of remeasurement, with the change in fair value recognized in “Change in fair value of earn-out liability” of the condensed consolidated statements of income.

The Company’s contingent consideration measured at fair value for the periods presented are as follows (in thousands):

	June 30, 2024								December 31, 2023
	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
Liability:
Contingent consideration (1)	$	1,170		-		-	$	1,170	$	1,208		-		-	$	1,208
Total liabilities	$	1,170		-		-	$	1,170	$	1,208		-		-	$	1,208

(1) As of June 30, 2024 and December 31, 2023, contingent consideration includes certain amounts in other long-term liabilities on the Company’s condensed consolidated balance sheets.

The following table provides a reconciliation of changes in the fair value of the Company’s earn-out liabilities associated with the Company’s acquisition measured at fair value for the three and six months ended June 30, 2024 and 2023 (in thousands):

	Three Months Ended June 30,					Six Months Ended June 30,
	2024			2023		2024			2023
Beginning period balance	$	1,182			-	$	1,208			-
Additions to contingent consideration		-			-		-			-
Payments of contingent consideration		-			-		-			-
Fair value adjustment of earn-out liabilities		-			-		-			-
Currency translation adjustment		(12	)		-		(38	)		-
Ending period balance	$	1,170		$	-	$	1,170		$	-