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Fair Value Measurements

12 Months Ended

Dec. 31, 2022

Assets and liabilities recorded at fair value in the consolidated financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels which are directly related to the amount of subjectivity associated with the inputs to the valuation of these assets or liabilities are as follows:

Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date.

Level 2—Inputs are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities.

Level 3—Unobservable inputs for the asset or liability only used when there is little, if any, market activity for the asset or liability at the measurement date. This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value.

Assets and Liabilities Measured and Recorded at Fair Value on a Recurring Basis—Financial assets and liabilities held by the Company measured at fair value on a recurring basis include money market funds and marketable securities.

Assets and Liabilities Measured and Recorded at Fair Value on a Nonrecurring Basis—The Company determines the fair value of long-lived assets held and used, such as intangible assets, by reference to independent appraisals, quoted market prices (e.g. an offer to purchase) and other factors. An impairment charge is recorded when the carrying value of the asset exceeds its fair value. As noted above, there have been no impairment charges recorded to date. Based on the borrowing rates currently available to the Company for debt with similar terms and consideration of default and credit risk, the carrying value of the term loan approximates the fair value. The fair value of the term loan is estimated using Level 2 inputs.

Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability.

The following tables summarizes the types of assets and liabilities measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands):


	December 31, 2022
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	4,647	$	—	$	—	$	4,647
Cash equivalents	4,647		—		—		4,647
U.S. Government agency bonds	14,743		15,872		—		30,615
Commercial paper	—		14,711		—		14,711
Marketable securities	14,743		30,583		—		45,326
Total financial assets	$	19,390	$	30,583	$	—	$	49,973


	December 31, 2021
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	831	$	—	$	—	$	831
Commercial paper	—		2,000		—		2,000
Corporate bonds	—		4,410		—		4,410
Cash equivalents	831		6,410		—		7,241
U.S. Government agency bonds	14,977		5,504		—		20,481
Commercial paper	—		19,107		—		19,107
Corporate bonds	—		2,914		—		2,914
Marketable securities	14,977		27,525		—		42,502
Total financial assets	$	15,808	$	33,935	$	—	$	49,743

There were no liabilities measured at fair value on a recurring and non-recurring basis as of December 31, 2022 and December 31, 2021.

The following table summarizes the cost, unrealized gains and losses and fair value of marketable securities (in thousands):


	December 31, 2022
	Amortized Cost		Unrealized Losses		Unrealized Gains		Fair Value
U.S. Government agency bonds	$	30,897	$	(282)	$	—	$	30,615
Commercial paper	14,740		(29)		—		14,711
Marketable securities	$	45,637	$	(311)	$	—	$	45,326
Amounts recognized on the consolidated balance sheet
Short-term marketable securities							39,402
Long-term marketable securities							5,924
Marketable securities							$	45,326


	December 31, 2021
	Amortized Cost		Unrealized Losses		Unrealized Gains		Fair Value
U.S. Government agency bonds	$	20,509	$	(28)	$	—	$	20,481
Corporate bonds	2,915		(1)		—		2,914
Commercial paper	19,102		—		5		19,107
Marketable securities	$	42,526	$	(29)	$	5	$	42,502
Amounts recognized on the consolidated balance sheet
Short-term marketable securities							31,561
Long-term marketable securities							10,941
Marketable securities							$	42,502

As of December 31, 2022 and 2021, all of the marketable securities are classified as available for sale, in which short-term marketable securities mature within one year and long-term marketable securities mature in one to two years.

At December 31, 2022 and 2021, accrued interest on marketable securities of $0.1 million and $0.1 million was included in prepaid expenses and other current assets on the consolidated balance sheets, respectively.

- 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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