Financial Instruments and Fair Value Measurements

12 Months Ended

Dec. 31, 2021

Financial Instruments and Fair Value Measurements

3. Financial Instruments and Fair Value Measurements

The Company’s financial instruments consist of money market funds, U.S. government debt securities and corporate debt securities. The following tables show the Company’s cash equivalents and available-for-sale securities’ carrying amounts and fair values as of December 31, 2021 and 2020:

	As of December 31, 2021
	Carrying Amount		Fair Value		Quoted priced in active markets (level 1)		Significant other observable inputs (level 2)		Significant unobservable inputs (level 3)
Financial assets
Money market funds	$	40,960	$	40,960	$	40,960	$	–	$	–
Corporate securities		227,362		227,362		–		227,362		–
Government securities		42,245		42,245		–		42,245		–
Total financial assets	$	310,567	$	310,567	$	40,960	$	269,607	$	–

	As of December 31, 2020
	Carrying Amount		Fair Value		Quoted priced in active markets (level 1)		Significant other observable inputs (level 2)		Significant unobservable inputs (level 3)
Financial assets
Money market funds	$	240,033	$	240,033	$	240,033	$	–	$	–
Corporate securities		120,008		120,008		–		120,008		–
Total financial assets	$	360,041	$	360,041	$	240,033	$	120,008	$	–

Cash and Cash Equivalents – As of December 31, 2021, the company had cash of $3,508 and cash equivalents of $168,960. Cash equivalents consisted of money market funds of $40,960 and corporate debt securities of $128,000. Cash equivalents of $360,041 as of December 31, 2020 consisted of money market funds of $240,033 and corporate debt securities of $120,008. Money market funds are classified within level 1 of the fair value hierarchy because they are valued using quoted market prices in active markets, whereas corporate debt securities are classified within level 2 of the fair value hierarchy because they are valued using inputs other than quoted prices that are observable for the asset or liability either directly or indirectly.

Marketable Securities – Marketable securities of $141,607 as of December 31, 2021 consisted of corporate debt securities of $99,362 and government debt securities of $42,245. There were $124,696 current marketable securities and $16,911 noncurrent marketable securities as of December 31, 2021. There were no marketable securities as of December 31, 2020.

- 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.

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