Fair Value of Financial Instruments

3 Months Ended

Mar. 31, 2020

3. Fair Value of Financial Instruments

The Company’s financial assets and liabilities subject to fair value measurements on a recurring basis and the level of inputs used for such measurements were as follows:


	March 31, 2020
	Level 1		Level 2		Level 3		Total
Assets
Money market funds	$	85,176	$	—	$	—	$	85,176
Certificates of deposit		2,644		—		—		2,644
Commercial paper		—		19,544		—		19,544
Corporate debt securities		—		16,400		—		16,400
U.S. Treasury securities		31,217		—		—		31,217
U.S. Agency bonds		—		10,015		—		10,015
	$	119,037	$	45,959	$	—	$	164,996

	December 31, 2019
	Level 1		Level 2		Level 3		Total
Assets
Money market funds	$	152,770	$	—	$	—	$	152,770
Certificates of deposit		1,950		—		—		1,950
Corporate debt securities		—		3,459		—		3,459
U.S. Treasury securities		20,052		—		—		20,052
Total	$	174,772	$	3,459	$	—	$	178,231

The Company utilized the market approach and Level 1 valuation inputs to value its money market funds and U.S. government treasury securities because published net asset values were readily available. The Company measured the fair value of the commercial paper, corporate debt securities and U.S. agency bonds using Level 2 valuation inputs, which are based on quoted prices and market observable data of similar instruments. As of March 31, 2020 and 2019, gross unrealized gains and unrealized losses for cash equivalents and short-term investments were not material, and the contractual maturity of all marketable securities was less than two years.

- 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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