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Fair Value of Financial Instruments

6 Months Ended

Jun. 27, 2020

Fair Value of Financial Instruments

Fair Value of Financial Instruments

2. Fair Value of Financial Instruments

The following tables show CRA’s financial instruments as of June 27, 2020 and December 28, 2019 that are measured and recorded in the condensed consolidated financial statements at fair value on a recurring basis (in thousands):

​	​	​	​	​	​	​	​	​	​
​	​	June 27, 2020
​	​	Quoted Prices in Active		​	​		​	​
​	​	Markets for Identical		​	Significant Other		​	Significant Unobservable
​	​	Assets or Liabilities		​	Observable Inputs		​	Inputs
​		Level 1			Level 2			Level 3
Assets:	​	​	​	​	​	​	​	​	​
Money market mutual funds	​	$	150		$	—		$	—
Total Assets	​	$	150	​	$	—	​	$	—
Liabilities:	​	​	​	​	​	​	​	​	​
Contingent consideration liability	​	$	—		$	—		$	12,575
Total Liabilities	​	$	—	​	$	—	​	$	12,575

​

​	​	​	​	​	​	​	​	​	​
​	​	December 28, 2019
​	​	Quoted Prices in Active		​	​	​	​	​
​	​	Markets for Identical		​	Significant Other		​	Significant Unobservable
​	​	Assets or Liabilities		​	Observable Inputs		​	Inputs
​		Level 1			Level 2			Level 3
Assets:	​	​	​	​	​	​	​	​	​
Money market mutual funds	​	$	150		$	—		$	—
Total Assets	​	$	150	​	$	—	​	$	—
Liabilities:	​	​	​	​	​	​	​	​	​
Contingent consideration liability	​	$	—	​	$	—	​	$	11,579
Total Liabilities	​	$	—	​	$	—	​	$	11,579

​

The fair value of CRA’s money market mutual fund share holdings is $1.00 per share.

The contingent consideration liability in the table above is for estimated future contingent consideration payments related to the acquisition of C1 Consulting, LLC, an independent consulting firm, and its wholly-owned subsidiary C1 Associates (collectively, “C1”). The fair value measurement of the liability is based on significant inputs not observed in the market and thus represents a Level 3 measurement. The significant unobservable inputs used in the fair value measurement of the contingent consideration liability are CRA’s measures of the estimated payouts based on internally generated revenue projections, expected volatility of the revenue projections, and discount rates. The fair value of the contingent consideration liability was determined using a Monte Carlo simulation. The fair value of the contingent consideration liability is reassessed on a quarterly basis by CRA using additional information as it becomes available, and any change in the fair value estimates are recorded in costs of services (exclusive of depreciation and amortization) on the condensed consolidated statements of operations. The contingent consideration is required to be paid prior to the end of the second quarter of fiscal 2021.

The following table summarizes the changes in the contingent consideration liabilities (in thousands):

​

​	​	​	​	​	​	​
​	​	Fiscal Year-to-Date		​	​	​
​	​	Period Ended		​	Fiscal Year Ended
​	​	June 27, 2020		​	December 28, 2019
Beginning balance	​	$	11,579	​	$	6,197
Remeasurement of acquisition-related contingent consideration	​		448	​		3,285
Accretion	​	​	548	​	​	2,097
Ending balance	​	$	12,575	​	$	11,579

​

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- References

No definition available.

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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 http://asc.fasb.org/extlink&oid=117815213&loc=d3e19207-110258

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