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INVESTMENTS AND FAIR VALUE MEASUREMENTS
 12 Months Ended
Dec. 31, 2020
Fair Value Disclosures [Abstract]  
INVESTMENTS AND FAIR VALUE MEASUREMENTS INVESTMENTS AND FAIR VALUE MEASUREMENTS
At December 31, 2020 and 2019, $25,919 and $24,136, respectively, of funds held for clients were invested in available-for-sale securities consisting of government and commercial bonds, including mortgage backed securities. As of December 31, 2020 and 2019, we also had $63,999 and $48,500, respectively, of funds held for clients invested in money market funds and other cash equivalents. Cash equivalents as of December 31, 2020 and December 31, 2019 was not material.

Investments classified as available-for-sale consisted of the following:
Amortized
Cost
Gross
Unrealized
Gains (1)
Gross
Unrealized
Losses (1)
Aggregate
Estimated
Fair Value
December 31, 2020:
Funds Held for Clients (2)
Certificates of deposit$7,370 $204 $— $7,574 
Corporate debt securities9,415 297 (1)9,711 
Municipal bonds7,531 103 (1)7,633 
US Government agency securities500 1 — 501 
Asset-backed securities499 1 — 500 
Total$25,315 $606 $(2)$25,919 
December 31, 2019:
Funds Held for Clients (2)
Certificates of deposit$8,828 $11 $— $8,839 
Corporate debt securities6,883 6 (9)6,880 
Municipal bonds6,383 6 (7)6,382 
US Government agency securities1,000 — — 1,000 
Asset-backed securities1,067 — (32)1,035 
Total$24,161 $23 $(48)$24,136 

(1)Unrealized gains and losses on available-for-sale securities are included as a component of comprehensive loss. At December 31, 2020, there were 69 securities in an unrealized gain position and there were 2 securities in an unrealized loss position. These unrealized losses were less than $(1) individually and $(2) in the aggregate. These securities have not been in a continuous unrealized gain or loss position for more than 12 months. The Company does not intend to sell these investments and it is not more likely than not that the Company will be required to sell these investments before recovery of their amortized cost basis, which may be at maturity. The Company reviews its investments to identify and evaluate investments that have an indication of possible other-than-temporary impairment. 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 and near-term prospects of the investee, and the Company’s intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value.
(2)At December 31, 2020 and 2019, none of these securities were classified as cash and cash equivalents on the Company’s balance sheet.

Expected maturities of available-for-sale securities as of December 31, 2020 are as follows:
One year or less$5,507 
After one year through five years20,412 
After five years through 10 years— 
After 10 years— 
$25,919 


ASC 820, Fair Value Measurements and Disclosures defines fair value, establishes a framework for measuring fair value in U.S. generally accepted accounting principles and expands disclosures about fair value measurements.

ASC 820 establishes a three-tier fair value hierarchy, which is based on the reliability of the inputs used in measuring fair values. These tiers include:

Level 1:    Quoted prices in active markets for identical assets or liabilities;

Level 2:    Quoted prices in active markets for similar assets or liabilities; quoted prices in markets that are not active for identical or similar assets or liabilities; and model-driven valuations whose significant inputs are observable; and

Level 3:    Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
The following table presents the fair value hierarchy for our financial assets measured at fair value on a recurring basis as of December 31, 2020 and December 31, 2019, respectively:

Fair Value Measure at December 31, 2020
Total Carrying Value at December 31, 2020Quoted
Prices
in Active
Market
(Level 1)		Significant
Other
Observable
Inputs
(Level 2)		Significant
Unobservable
Inputs
(Level 3)
Assets:
Cash and cash equivalents
Money market funds$5,204 $5,204 $— $— 
Funds held for clients
Money market funds63,999 63,999 — — 
Available-for-sale securities25,919 — 25,919 — 
Total$95,122 $69,203 $25,919 $— 
Liabilities:
Contingent purchase consideration$3,880 $— $— $3,880 
Total$3,880 $— $— $3,880 
 Fair Value Measure at December 31, 2019
Total Carrying Value at December 31, 2019Quoted
Prices
in Active
Market
(Level 1)		Significant
Other
Observable
Inputs
(Level 2)		Significant
Unobservable
Inputs
(Level 3)
Assets:
Funds held for clients
Money market funds$48,500 $48,500 $— $— 
Available-for-sale securities24,136 — 24,136 — 
Total$72,636 $48,500 $24,136 $— 
Other Financial Assets and Liabilities
Financial assets and liabilities with carrying amounts approximating fair value include cash and cash equivalents, trade accounts receivable, accounts payable, accrued expenses and other current liabilities.  The carrying amount of these financial assets and liabilities approximates fair value because of their short maturities.
Our line of credit and notes payable, including current portion, as of December 31, 2020, had a carrying value of $24,913.  This carrying value approximates fair value.  The fair value is based on interest rates that are currently available to us for issuance of debt with similar terms and remaining maturities. 
Our Level 3 balance is comprised of a contingent purchase obligation. This obligation is calculated using a Monte Carlo model that has significant unobservable inputs. We will revalue this obligation each quarter until it is paid.
In July 2020, we acquired certain assets of a payroll tax business. The initial Purchase price for the assets was $4,250, which we paid for in cash at closing. The seller will be paid additional consideration for the assets based on the trailing twelve-month revenue at each of April 30, 2021 and October 31, 2021. Subject to any disagreement as to the calculation of the contingent purchase consideration, payments for contingent purchase consideration, if any, will be made by May 30, 2021 and December 30, 2021. For the initial measurement, we utilized a Monte Carlo simulation to determine the fair value of the contingent purchase consideration. We utilized a discounted cash flow model to determine if an adjustment was required at December 31, 2020. There was a $1,135 adjustment to the fair value of the contingent consideration at December 31, 2020.
Balance at January 1, 2020$— 
Purchase2,745 
Net realized / unrealized losses1,135 
Balance at December 31, 2020$3,880