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Fair Value Measurements

12 Months Ended

Jan. 03, 2020

FAIR VALUE MEASUREMENTS

Fair value reflects the amounts that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy has the following three levels:


•	Level 1 - quoted prices (unadjusted) in active markets for identical assets and liabilities;


•	Level 2 - inputs other than level 1 that are observable either directly or indirectly, such as quoted prices in active markets for similar instruments or on industry models using data inputs, such as interest rates and prices that can be directly observed or corroborated in active markets;


•	Level 3 - unobservable inputs that are supported by little or no market activity that are significant to the fair value measurement

The classifications within the fair value hierarchy of our financial assets that were measured and recorded at fair value on a recurring basis were as follows (in thousands):



	December 31, 2019
	Level 1		Level 2		Total
Commercial paper	$	—	$	389,573	$	389,573
Corporate bonds	—		756,226		756,226
U.S. Treasury and government sponsored enterprises	—		166,665		166,665
Total investment securities available-for-sale	—		1,312,464		1,312,464
Money market funds	2,467		—		2,467
Certificates of deposit	—		32,733		32,733
Total financial assets carried at fair value	$	2,467	$	1,345,197	$	1,347,664



	December 31, 2018
	Level 1		Level 2		Total
Commercial paper	$	—	$	381,133	$	381,133
Corporate bonds	—		344,064		344,064
U.S. Treasury and government sponsored enterprises	—		55,201		55,201
Total investment securities available-for-sale	—		780,398		780,398
Money market funds	47,744		—		47,744
Certificates of deposit	—		16,596		16,596
Total financial assets carried at fair value	$	47,744	$	796,994	$	844,738

When available, we value investments based on quoted prices for those financial instruments, which is a Level 1 input. Our remaining investments are valued using third-party pricing sources, which use observable market prices, interest rates and yield curves observable at commonly quoted intervals for similar assets as observable inputs for pricing, which is a Level 2 input.

The carrying amount of our remaining financial assets and liabilities, which include cash and restricted cash, receivables and payables approximate their fair values due to the short-term nature.

- 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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