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Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2022

Summary of Company's Fair Value Hierarchy for its Financial Assets and Liabilities

The following table represents the Company’s fair value hierarchy for its financial assets and liabilities that are measured at fair value on a recurring basis (in thousands):


	As of December 31, 2022
	Level 1		Level 2		Total
Assets:
Money market funds (1)	$	5,800	$	—	$	5,800
Marketable investments (2)		—		19,688		19,688
Total Assets	$	5,800	$	19,688	$	25,488


	As of December 31, 2021
	Level 1		Level 2			Total
Assets:
Money market funds (1)	$	6,885	$	—		$	6,885
Marketable investments (2)		—	$	18,509			18,509
Total Assets	$	6,885	$	18,509		$	25,394

Liabilities:
Interest rate swap (3)	$	—	$	(294	)	$	(294	)
Total Liabilities	$	—	$	(294	)	$	(294	)

(1)

Included in cash and cash equivalents in the Consolidated Balance Sheets.

(2)

Marketable investments have been initially valued at the transaction price and subsequently valued, at the end of the reporting period, utilizing third party pricing services or other market observable data. The pricing services utilize industry standard valuation methods, including both income and market based approaches and observable market inputs to determine value. These observable market inputs include reportable trades, benchmark yields, credit spreads, broker/dealer quotes, bids, offers, current spot rates and other industry and economic events.

(3)

The Company had an interest rate swap contract that hedged the risk of variability from interest payments on its borrowings (refer to Note 4 – Debt and Note 6 – Derivatives and Hedging). The fair value of the interest rate swap was based on mark-to-market valuations prepared by a third-party broker. Those valuations were based on observable interest rates and other observable market data, which the Company considers Level 2 inputs.

Summary of Changes in the Fair Value of Level 3 Contingent Consideration

Changes in the fair value of Level 3 contingent consideration were as follows (in thousands):


	Contingent
	Consideration
Balance at December 31, 2019		(2,511	)
Fair value adjustment of contingent purchase price (1)		(22	)
Payment of contingent purchase price (2)		2,680
Foreign exchange effect		(147	)
Balance at December 31, 2020	$	—

(1)

Subsequent to the acquisition of FeedbackNow, the increases in the fair value of the contingent consideration were primarily due to the achievement of contract bookings during these periods. The Monte Carlo simulation was used to determine the fair value and increases or decreases in the simulation’s inputs would have resulted in higher or lower fair value measurements. These amounts were recognized as acquisition and integration costs in the Consolidated Statements of Income.

(2)

During the third quarter of 2020, the second year financial targets were met and $2.7 million was paid to the sellers during the fourth quarter of 2020.