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Fair Value of Financial Instruments
 12 Months Ended
Dec. 31, 2022
Fair Value of Financial Instruments  
Fair Value of Financial Instruments

8. Fair Value of Financial Instruments:

 

For certain of Solitario's financial instruments, including cash and cash equivalents, payables and short-term debt, the carrying amounts approximate fair value due to their short maturities. Solitario's marketable equity securities, including its investment in shares of Kinross common stock, Vendetta common stock, Vox common stock and TNR common stock are carried at their estimated fair value based on publicly available quoted market prices.     

 

Solitario applies ASC 820 that establishes a framework for measuring fair value and requires enhanced disclosures about fair value measurements. ASC 820 clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. ASC 820 also requires disclosure about how fair value is determined for assets and liabilities and establishes a hierarchy for which these assets and liabilities must be grouped, based on significant levels of inputs as follows:

 

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

Level 2: Quoted prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability; or

Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

 

The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement.  During the years ended December 31, 2022 and 2021, there were no reclassifications in financial assets or liabilities between Level 1, 2 or 3 categories.

The following is a listing of Solitario’s financial assets and liabilities required to be measured at fair value on a recurring basis and where they are classified within the hierarchy as of December 31, 2022:

 

(in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Short-term investments

 

$3,951

 

 

$-

 

 

$-

 

 

$3,951

 

Marketable equity securities

 

$949

 

 

$-

 

 

$-

 

 

$949

 

 

The following is a listing of Solitario’s financial assets and liabilities required to be measured at fair value on a recurring basis and where they are classified within the hierarchy as of December 31, 2021:

 

(in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Short-term investments

 

$5,087

 

 

$-

 

 

$-

 

 

$5,087

 

Marketable equity securities

 

$1,307

 

 

$-

 

 

$-

 

 

$1,307

 

Vendetta Warrants

 

$-

 

 

$3

 

 

$-

 

 

$3

 

 

Items measured at fair value on a recurring basis:

 

Short-term investments: At December 31, 2022 and 2021, Solitario’s holdings of short-term investments consist of USTS and CD’s at December 31, 2021, both recorded at their fair value based upon quoted market prices.

Marketable equity securities: At December 31, 2022 and 2021, the fair value of Solitario’s holdings in shares of Vendetta, Kinross, and Vox marketable equity securities are based upon quoted market prices.

Vendetta Warrants:  At December 31, 2021 the fair value of Solitario’s Vendetta Warrants is based upon a Black Scholes model, using market inputs. 

 

During the year ended December 31, 2022, Solitario did not change any of the valuation techniques used to measure its financial assets and liabilities at fair value.