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Fair Value of Financial Instruments
 9 Months Ended
Sep. 30, 2012
Fair Value of Financial Instruments  
Fair Value of Financial Instruments

Note 2. Fair Value of Financial Instruments

 

The estimated fair values of financial instruments outstanding were as follows (in thousands):

 

 

 

September 30, 2012

 

 

 

Cost

 

Unrealized
Gains

 

Unrealized
Losses

 

Fair
Value

 

Cash and cash equivalents

 

$

5,967

 

$

—

 

$

—

 

$

5,967

 

Short-term investments:

 

 

 

 

 

 

 

 

 

U.S. government debt securities

 

$

10,628

 

$

4

 

$

—

 

$

10,632

 

Corporate notes and commercial paper

 

14,403

 

15

 

(1

)

14,417

 

Certificates of deposit

 

5,156

 

3

 

—

 

5,159

 

Total short-term investments

 

$

30,187

 

$

22

 

$

(1

)

$

30,208

 

Long-term investments:

 

 

 

 

 

 

 

 

 

U.S. government debt securities

 

$

6,770

 

$

2

 

$

—

 

$

6,772

 

Corporate notes

 

2,074

 

2

 

—

 

2,076

 

Certificates of deposit

 

240

 

1

 

—

 

241

 

Total long-term investments

 

$

9,084

 

$

5

 

$

—

 

$

9,089

 

 

 

 

December 31, 2011

 

 

 

Cost

 

Unrealized
Gains

 

Unrealized
Losses

 

Fair
Value

 

Cash and cash equivalents

 

$

40,025

 

$

—

 

$

—

 

$

40,025

 

Short-term investments:

 

 

 

 

 

 

 

 

 

U.S. government debt securities

 

$

4,834

 

$

2

 

$

—

 

$

4,836

 

Corporate notes

 

4,578

 

1

 

(2

)

4,577

 

Total short-term investments

 

$

9,412

 

$

3

 

$

(2

)

$

9,413

 

Long-term investments:

 

 

 

 

 

 

 

 

 

U.S. government debt securities

 

$

5,721

 

$

1

 

$

(1

)

$

5,721

 

Corporate notes

 

2,816

 

2

 

(2

)

2,816

 

Total long-term investments

 

$

8,537

 

$

3

 

$

(3

)

$

8,537

 

 

As of September, 30, 2012 and December 31, 2011, all of the available-for-sale securities with unrealized losses had been in a loss position for less than 12 months. Total fair value of available-for-sale securities with unrealized losses was $7.6 million at September 30, 2012.

 

Cost and fair value of investments based on two maturity groups were as follows (in thousands):

 

 

 

September 30, 2012

 

 

 

Cost

 

Unrealized
Gains

 

Unrealized
Losses

 

Fair
Value

 

Due within 1 year

 

$

30,187

 

$

22

 

$

(1

)

$

30,208

 

Due in 1-2 years

 

9,084

 

5

 

—

 

9,089

 

Total

 

$

39,271

 

$

27

 

$

(1

)

$

39,297

 

 

 

 

December 31, 2011

 

 

 

Cost

 

Unrealized
Gains

 

Unrealized
Losses

 

Fair
Value

 

Due within 1 year

 

$

9,412

 

$

3

 

$

(2

)

$

9,413

 

Due in 1-2 years

 

8,537

 

3

 

(3

)

8,537

 

Total

 

$

17,949

 

$

6

 

$

(5

)

$

17,950

 

 

The following table represents the Company’s fair value hierarchy for its financial assets (cash equivalents and investments) as of September 30, 2012 and December 31, 2011 (in thousands):

 

 

 

September 30, 2012

 

 

 

Fair Value

 

Level 1

 

Level 2

 

Level 3

 

Money market funds

 

$

1,445

 

$

1,445

 

$

—

 

$

—

 

Certificates of deposit

 

5,400

 

—

 

5,400

 

—

 

Corporate notes and commercial paper

 

20,019

 

—

 

20,019

 

—

 

U.S. government debt securities

 

17,905

 

—

 

17,905

 

—

 

Total assets

 

$

44,769

 

$

1,445

 

$

43,324

 

$

—

 

 

 

 

December 31, 2011

 

 

 

Fair Value

 

Level 1

 

Level 2

 

Level 3

 

Money market funds

 

$

2,792

 

$

2,792

 

$

—

 

$

—

 

Corporate notes

 

7,393

 

—

 

7,393

 

—

 

U.S. government debt securities

 

10,557

 

—

 

10,557

 

—

 

Total assets

 

$

20,742

 

$

2,792

 

$

17,950

 

$

—

 

 

There were no transfers in or out of Level 1 and Level 2 securities during the three and nine months ended September 30, 2012 and 2011. There were no Level 3 financial assets as of September 30, 2012 or December 31, 2011.