Note 3 - Short-Term Investments

12 Months Ended

Dec. 31, 2012

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

Note 3: Short-Term Investments

In accordance with ASC 320, Investments – Debt and Equity Securities, Onvia classifies short-term investments in debt securities as available-for-sale at December 31, 2012, stated at fair value as summarized in the following table:

	December 31, 2012
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Government backed securities	$	3,922,428	$	867	$	(211	)	$	3,923,084
Certificate of Deposit  (1)		4,056,977		468		-			4,057,445
Corporate Bonds		454,233		182		-			454,415
	$	8,433,638	$	1,517	$	(211	)	$	8,434,944

(1) We evaluated certificates of deposits held as of December 31, 2012 and concluded that they meet the definition of securities as defined in ASC 320.

Onvia accounts for short-term investments in accordance with ASC 820, Fair Value Measurements and Disclosures, which defines fair value as the exchange price that would be received for an asset, or paid to transfer a liability (an exit price), in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.  ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.  The standard describes three levels of inputs that may be used to measure fair value:

Level 1 – Quoted prices in active markets for identical assets or liabilities;

Level 2 – Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Onvia uses the market approach to measure fair value for its financial assets and liabilities.  The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.  The following table summarizes, by major security type, short-term investments classified as available-for-sale at December 31, 2012, stated at fair value:

	Fair Value Measurements as of December 31, 2012
	Level 1		Level 2		Level 3		Balance as of December 31, 2012
Description
U.S. Government backed securities	$	-	$	3,923,084	$	-	$	3,923,084
Certificate of Deposit		-		4,057,445		-		4,057,445
Corporate Bonds		-		454,415		-		454,415
	$	-	$	8,434,944	$	-	$	8,434,944

There were no transfers in or out of Level 1 or Level 2 investments during the fourth quarter of 2012, and there was no activity in Level 3 fair value measurements during that period.