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INVESTMENTS AND FAIR VALUE MEASUREMENTS | 12 Months Ended
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Dec. 31, 2024
Fair Value Disclosures [Abstract] |
INVESTMENTS AND FAIR VALUE MEASUREMENT | INVESTMENTS AND FAIR VALUE MEASUREMENTS ASC 820 “Fair Value Measurement” (ASC 820) defines fair value, establishes a framework for measuring fair value under U.S. GAAP and enhances disclosures about fair value measurements. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 describes a fair value hierarchy based on the following three levels of inputs that may be used to measure fair value, of which the first two are considered observable and the last unobservable:
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 and liabilities measured at fair value on a recurring basis as of December 31, 2024, and December 31, 2023, respectively (in thousands):
| Total Carrying Value |  | Level 1 |  | Level 2 |  | Level 3
December 31, 2024 |  |  |  |  |  |  |
Assets: |  |  |  |  |  |  |
Funds held for clients |  |  |  |  |  |  |
Money market funds | $ | 8,105 |  |  | $ | 8,105 |  |  | $ | — |  |  | $ | — |
Available-for-sale securities | 68,328 |  |  | — |  |  | 68,328 |  |  | — |
Total | $ | 76,433 |  |  | $ | 8,105 |  |  | $ | 68,328 |  |  | $ | — |
December 31, 2023 |  |  |  |  |  |  |
Assets: |  |  |  |  |  |  |
Funds held for clients |  |  |  |  |  |  |
Money market funds | $ | 3,431 |  |  | $ | 3,431 |  |  | $ | — |  |  | $ | — |
Available-for-sale securities | 71,770 |  |  | — |  |  | 71,770 |  |  | — |
Total | $ | 75,201 |  |  | $ | 3,431 |  |  | $ | 71,770 |  |  | $ | — |
Restricted cash equivalents and investments classified as available-for-sale within funds held for clients consisted of the following (in thousands):
| Amortized Cost |  | Gross Unrealized Gains (1) |  | Gross Unrealized Losses (1) |  | Aggregate Estimated Fair Value
December 31, 2024 |  |  |  |  |  |  |
Restricted cash equivalents | $ | 8,115 |  |  | $ | — |  |  | $ | (10) |  |  | $ | 8,105 |
Available-for-sale securities: |  |  |  |  |  |  |
Certificates of deposit | — |  |  | — |  |  | — |  |  | — |
Corporate debt securities | 63,253 |  |  | 164 |  |  | (619) |  |  | 62,798 |
Municipal bonds | 3,194 |  |  | — |  |  | (104) |  |  | 3,090 |
U.S. Government agency securities | 2,449 |  |  | 6 |  |  | (15) |  |  | 2,440 |
Total available-for-sale securities | 68,896 |  |  | 170 |  |  | (738) |  |  | 68,328 |
Total(2) | $ | 77,011 |  |  | $ | 170 |  |  | $ | (748) |  |  | $ | 76,433 |
December 31, 2023 |  |  |  |  |  |  |
Restricted cash equivalents | $ | 3,447 |  |  | $ | — |  |  | $ | (16) |  |  | $ | 3,431 |
Available-for-sale securities: |  |  |  |  |  |  |
Certificates of deposit | 845 |  |  | 2 |  |  | (1) |  |  | 846 |
Corporate debt securities | 67,277 |  |  | 258 |  |  | (1,090) |  |  | 66,445 |
Municipal bonds | 4,251 |  |  | — |  |  | (239) |  |  | 4,012 |
U.S. Government agency securities | 500 |  |  | — |  |  | (33) |  |  | 467 |
Total available-for-sale securities | 72,873 |  |  | 260 |  |  | (1,363) |  |  | 71,770 |
Total(2) | $ | 76,320 |  |  | $ | 260 |  |  | $ | (1,379) |  |  | $ | 75,201 |
(1)Unrealized gains and losses on available-for-sale securities are included as a component of comprehensive loss. As of December 31, 2024, and December 31, 2023, there were 45 and 54 securities, respectively, in an unrealized gain position and there were 89 and 113 securities in an unrealized loss position, respectively. As of December 31, 2024, these unrealized losses were less than $38 individually and $738 in the aggregate. As of December 31, 2023, these unrealized losses were less than $61 individually and $1,363 in the aggregate. We invest in high quality securities with roughly 64% of our portfolio made up of A ratings and above with unrealized losses primarily attributable to macroeconomic factors rather than credit related. We have no material individual securities that have been in a continuous unrealized loss position greater than twelve months. We do not intend to sell these investments, and we do not expect to sell these investments before recovery of their amortized cost basis, which may be at maturity. We review our investments to identify and evaluate investments that indicate possible credit losses. Factors considered in determining whether a loss is a credit loss 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 our 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, 2024, and December 31, 2023, none of these securities were classified as cash and cash equivalents on the accompanying Consolidated Balance Sheets. Funds held for clients represent assets that we have classified as restricted for use solely for the purposes of satisfying the obligations to remit funds relating to our payroll and payroll tax filing services, which are classified as client funds obligations on our Consolidated Balance Sheets. Funds held for clients have been invested in the following categories (in thousands):
| 2024 |  | 2023
Restricted cash and cash equivalents held to satisfy client funds obligations | $ | 124,287 |  |  | $ | 147,305 |
Restricted short-term marketable securities held to satisfy client funds obligations | 5,273 |  |  | 10,042 |
Restricted long-term marketable securities held to satisfy client funds obligations | 63,055 |  |  | 61,728 |
Total funds held for clients | $ | 192,615 |  |  | $ | 219,075 |
Expected maturities of available-for-sale securities as of December 31, 2024, are as follows (in thousands):
One year or less | $ | 5,273 |
After one year through five years | 63,055 |
| $ | 68,328 |

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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/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 107 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-107 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 100 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-100 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2E -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2E Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 940 -SubTopic 820 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478119/940-820-50-1 + Details
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