Fair Value Measurements

3 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

Fair Value Measurements

2. Fair Value Measurements

The carrying amounts of cash equivalents, prepaid and other assets, accounts payable and accrued liabilities are considered to be representative of their respective fair values because of the short-term nature of those instruments. Investment securities are recorded at fair value.

The accounting guidance defines fair value, establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis. Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the accounting guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

Level 1: Observable inputs such as quoted prices in active markets.

Level 2: Inputs, other than the quoted prices in active markets that are observable either directly or indirectly.

Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

Financial assets measured at fair value on a recurring basis consist of investment securities. Investment securities are recorded at fair value, defined as the exit price in the principal market in which we would transact, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. Level 2 securities are valued using quoted market prices for similar instruments, non-binding market prices that are corroborated by observable market data, or discounted cash flow techniques and include our investments in commercial paper, corporate debt securities and asset-bask securities. We have no financial liabilities measured at fair value on a recurring basis. None of our non-financial assets and liabilities are recorded at fair value on a non-recurring basis. No transfers between levels have occurred during the periods presented.

Assets measured at fair value on a recurring basis are as follows (in thousands):

			Fair Value Measurements Using
	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
As of March 31, 2022
Assets:
Current:
Cash equivalents	$	8,088	$	8,088	$	—	$	—
Available-for-sale investments:
Commercial paper		26,828		—		26,828		—
Corporate debt securities		50,671		—		50,671		—
Municipal bonds		12,843		—		12,843		—
Total available-for-sale investments		90,342		—		90,342		—
Total assets measured at fair value	$	98,430	$	8,088	$	90,342	$	—

			Fair Value Measurements Using
	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
As of December 31, 2021
Assets:
Current:
Cash equivalents	$	2,052	$	2,052	$	—	$	—
Available-for-sale investments:
Commercial paper		36,921		—		36,921		—
Corporate debt securities		55,713		—		55,713		—
Municipal bonds		12,941		—		12,941		—
Total available-for-sale investments		105,575		—		105,575		—
Total assets measured at fair value	$	107,627	$	2,052	$	105,575	$	—

As of March 31, 2022 and December 31, 2021, available-for-sale investments are detailed as follows (in thousands):

		March 31, 2022
	Contractual Maturity	Gross Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Market Value
Available-for-sale investments:
Commercial paper	Within 1 year	$	26,972	$	—	$	(144	)	$	26,828
Corporate debt securities	1 to 2 years		51,152		—		(481	)		50,671
Municipal bonds	1 to 2 years		12,927		—		(84	)		12,843
		$	91,051	$	—	$	(709	)	$	90,342

		December 31, 2021
	Contractual Maturity	Gross Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Market Value
Available-for-sale investments:
Commercial paper	Within 1 year	$	36,956	$	—	$	(35	)	$	36,921
Corporate debt securities	1 to 2 years		55,859		—		(146	)		55,713
Municipal bonds	1 to 2 years		12,973		—		(32	)		12,941
		$	105,788	$	—	$	(213	)	$	105,575

At each reporting date, we perform an evaluation of impairment to determine if any unrealized losses are other-than-temporary. Factors considered in determining whether a loss is other-than-temporary include the length of time and extent to which fair value has been less than the cost basis, the financial condition of the issuer, and our intent and ability to hold the investment until recovery of its amortized cost basis. We intend, and have the ability, to hold our investments in unrealized loss positions, if any, until their amortized cost basis has been recovered.

As of March 31, 2022, all available-for-sale investments had a variety of effective maturity dates of less than two years. As of March 31, 2022, all available-for-sale investments were in gross unrealized loss positions and have been in such loss positions less than twelve months.