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Fair Value Measurements
 12 Months Ended
Mar. 31, 2019
Fair Value Disclosures [Abstract]  
Fair Value Measurements

Note 20 — Fair Value Measurements

 

The following table presents the fair value of the Company’s financial liabilities that are measured at fair value on a recurring basis (in thousands):

 

   March 31, 2019 
   Fair   Hierarchy Level 
   Value   Level 1   Level 2   Level 3 
Liabilities:                
Bifurcated embedded derivative on senior secured convertible debentures  $586   $-   $-   $586 

 

The following table presents a reconciliation of the Company’s derivative instruments (in thousands):

 

   Amount 
Balance as of March 31, 2018  $- 
Bifurcated embedded derivative recognized on issuance of senior secured convertible debentures   263 
Total fair value adjustments reported in earnings   323 
Balance as of March 31, 2019  $586 

 

The Company did not elect the fair value measurement option for the following financial assets and liabilities. The fair values of certain financial instruments and the hierarchy level the Company used to estimate the fair values are shown below (in thousands):

 

   March 31, 2019 
   Carrying   Hierarchy Level 
   Value   Level 1   Level 2   Level 3 
Assets:                
Cash and cash equivalents  $13,704   $13,704   $-   $- 
Restricted cash   235    235    -    - 
Liabilities:                    
Note payable   312    -    -    312 
Senior secured convertible debentures, net   11,809    -    -    13,737 
Unsecured convertible notes payable, net   4,741    -    -    8,844 

 

   March 31, 2018 
   Carrying   Hierarchy Level 
   Value   Level 1   Level 2   Level 3 
Assets:                
Cash and cash equivalents  $10,285   $10,285   $-   $- 
Restricted cash   3,685    3,685    -    - 
Liabilities:                    
Note payable   294    -    -    294 
Bank debt   3,500    -    3,500    - 
Unsecured convertible notes payable, net   4,916    -    -    4,916 

 

The fair values of financial instruments not included in these tables are estimated to be equal to their carrying values as of March 31, 2019 and 2018. The Company’s estimates of the fair values were determined using available market information and appropriate valuation methods. Considerable judgment is necessary to interpret market data and develop the estimated fair values.

 

Cash equivalents and restricted cash equivalents primarily consisted of short-term interest-bearing money market funds with maturities of less than 90 days and time deposits. The estimated fair values were based on available market pricing information of similar financial instruments.

 

Due to their short maturity, the carrying amounts of the Company’s accounts receivable, accounts payable and accrued expenses approximated their fair values at March 31, 2019 and 2018.

 

The Company’s outstanding debt is carried at cost, adjusted for discounts. The Company’s bank debt is not publicly traded and the carrying amounts typically approximate fair value for debt that accrues interest at a variable rate, which are considered to be Level 2 inputs. The Company’s debentures, embedded derivatives and unsecured convertible notes payable with fixed rates are not publicly traded and the Company has estimated fair values using a variety of valuation models and market rate assumptions. The debentures, embedded derivates and unsecured convertible notes are valued using a binomial lattice model, a risk neutral model and a yield model with a Black-Scholes-Merton option pricing model, respectively. The Company has recognized $0.3 million of expense in the year ended March 31, 2019, related to the fair value of bifurcated derivatives through other income (expense). The Company’s note payable is not publicly traded and fair value is estimated to equal carrying value.