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Fair Value Measurements | 9 Months Ended
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Sep. 30, 2022
Fair Value Disclosures [Abstract] |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The Company's financial instruments consist of cash equivalents, short-term investments, accounts receivable, accounts payable, drawings on revolving lines of credit, long-term debt, interest rate swaps and contingent purchase consideration. The valuation techniques used to measure fair value are based upon observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect internal market assumptions. These two types of inputs create the following fair value hierarchy: Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for which little or no market data exists, therefore requiring an entity to develop its own assumptions. The Company classifies its financial instruments according to the prescribed criteria. The carrying amounts of money market fund deposits, term deposits, accounts receivable, accounts payable and drawings on revolving lines of credit are considered reasonable estimates of their fair market value due to the short maturity of most of these instruments or as a result of the competitive market interest rates, which have been negotiated. The fair value of the Company's bond securities is based upon quoted prices for instruments with identical terms in active markets. The Company's commercial paper securities reported at fair value are based upon model-driven valuations in which all significant inputs are observable or can be derived from or corroborated by observable market data for substantially the full term of the asset or liability, and are therefore classified as Level 2. The following table presents fair value information related to the Company's assets and liabilities measured at amortized cost on the condensed consolidated balance sheets with the exception of the interest rate swap and contingent purchase consideration, which are measured at fair value:
| Fair Value Measurements at September 30, 2022
| Total |  | Level 1 |  | Level 2 |  | Level 3
Assets |  |  |  |  |  |  |
Cash equivalents: |  |  |  |  |  |  |
Money market fund deposits and term deposits | $ | 457,754 |  |  | $ | 457,754 |  |  | $ | — |  |  | $ | — |
Commercial paper | 112,506 |  |  | — |  |  | 112,506 |  |  | — |
Certificate of deposit | 17 |  |  | — |  |  | 17 |  |  | — |
Short-term investments: |  |  |  |  |  |  |
Commercial paper | 317,457 |  |  | — |  |  | 317,457 |  |  | — |
Corporate bonds | 20,786 |  |  | — |  |  | 20,786 |  |  | — |
U.S. Treasury and agency obligations | 14,756 |  |  | — |  |  | 14,756 |  |  | — |
Certificates of deposit | 11,713 |  |  | — |  |  | 11,713 |  |  | — |
Other assets: |  |  |  |  |  |  |
Interest rate swap | 258 |  |  | — |  |  | 258 |  |  | — |
Total | $ | 935,247 |  |  | $ | 457,754 |  |  | $ | 477,493 |  |  | $ | — |
Liabilities |  |  |  |  |  |  |
Term note | $ | 16,328 |  |  | $ | — |  |  | $ | 16,328 |  |  | $ | — |
Total | $ | 16,328 |  |  | $ | — |  |  | $ | 16,328 |  |  | $ | — |
| Fair Value Measurements at December 31, 2021
| Total |  | Level 1 |  | Level 2 |  | Level 3
Assets |  |  |  |  |  |  |
Cash equivalents: |  |  |  |  |  |  |
Money market fund deposits and term deposits | $ | 279,066 |  |  | $ | 279,066 |  |  | $ | — |  |  | $ | — |
Commercial paper | 117,663 |  |  | — |  |  | 117,663 |  |  | — |
Corporate bonds | 11,459 |  |  | — |  |  | 11,459 |  |  | — |
Municipal bonds | 3,220 |  |  | — |  |  | 3,220 |  |  | — |
Short-term investments: |  |  |  |  |  |  |
Commercial paper | 557,955 |  |  | — |  |  | 557,955 |  |  | — |
Corporate bonds | 215,754 |  |  | — |  |  | 215,754 |  |  | — |
U.S. Treasury and agency obligations | 21,980 |  |  | — |  |  | 21,980 |  |  | — |
Municipal bonds | 4,546 |  |  | — |  |  | 4,546 |  |  | — |
Certificate of deposit | 3,000 |  |  | — |  |  | 3,000 |  |  | — |
Foreign government bonds | 2,015 |  |  | — |  |  | 2,015 |  |  | — |
Total | $ | 1,216,658 |  |  | $ | 279,066 |  |  | $ | 937,592 |  |  | $ | — |
Liabilities |  |  |  |  |  |  |
Term notes | $ | 34,226 |  |  | $ | — |  |  | $ | 34,226 |  |  | $ | — |
Contingent purchase consideration | 1,371 |  |  | — |  |  | — |  |  | 1,371 |
Interest rate swap | 242 |  |  | — |  |  | 242 |  |  | — |
Total | $ | 35,839 |  |  | $ | — |  |  | $ | 34,468 |  |  | $ | 1,371 |
Short-term investments consist of liquid investments with original maturities of greater than three months but less than one year and are recorded at amortized cost. There were no impairments for the investments considered held-to-maturity during the quarters ended September 30, 2022 and 2021. There were no current expected credit loss allowances for the investments considered held-to-maturity at September 30, 2022 and 2021. The Company holds highly-rated held-to-maturity instruments that are within one year of maturity. The following table presents the effective maturity dates of debt investments, which are held-to-maturity:
| September 30, 2022 |  | December 31, 2021
| Book Value |  | Fair Value |  | Book Value |  | Fair Value
Investment maturity |  |  |  |  |  |  |
Less than 1 year | $ | 365,409 |  |  | $ | 364,712 |  |  | $ | 805,400 |  |  | $ | 805,250 |
The Company entered into an interest rate swap that is designated as a cash flow hedge associated with a long-term note issued during the second quarter of 2016 that will terminate with the long-term note in May 2023. The fair value at September 30, 2022 for the interest rate swap considered pricing models whose inputs are observable for the securities held by the Company. At September 30, 2022, the Company's long-term note consisted of a variable rate note. The carrying value of the note approximates the estimated fair value of $16,328. At December 31, 2021, the Company's long-term notes consisted of a variable rate note and a fixed rate note. The fair value of the notes were estimated using a discounted cash flow model using observable market interest rates. The fair value of the long-term notes, including the current portion, at December 31, 2021, was $34,226 as compared to the carrying value of $34,157. The long-term notes were reported at amortized cost on the condensed consolidated balance sheets and were classified within Level 2 of the fair value hierarchy. The fair values of contingent purchase consideration at December 31, 2021 were determined using an income approach at the respective business combination date and at the reporting date. The approach is based on significant inputs that are not observable in the market and include key assumptions such as assessing the probability of meeting certain milestones required to earn the contingent purchase consideration. The contingency period ended during the nine months ended September 30, 2022. The following table presents information about the Company's movement in Level 3 assets and liabilities measured at fair value:
|  |  | Nine Months Ended September 30,
|  |  |  |  | 2022 |  | 2021
Contingent purchase consideration |  |  |  |  |  |  |
Balance, beginning of period |  |  |  |  | $ | 1,371 |  |  | $ | 1,963 |
Cash payments |  |  |  |  | — |  |  | (466) |
Change in fair value |  |  |  |  | (1,477) |  |  | — |
Foreign exchange adjustment |  |  |  |  | 106 |  |  | (91) |
Balance, end of period |  |  |  |  | $ | — |  |  | $ | 1,406 |

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- 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. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI https://asc.fasb.org/extlink&oid=126976982&loc=d3e19207-110258 + Details
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