XML 25 R13.htm IDEA: XBRL DOCUMENT
v3.20.2

Fair Value Measurements | 3 Months Ended
--- | ---
Jun. 30, 2020
Financial Instruments, Owned, at Fair Value [Abstract] |
Fair Value Measurements | Fair Value Measurements Fair Value Measurements The Company considers fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. The Company utilizes the following three-level fair value hierarchy to establish the priorities of the inputs used to measure fair value: •Level 1 — Quoted prices in active markets for identical assets or liabilities. •Level 2 — Observable inputs other than quoted market prices included in Level 1, such as: quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. •Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. The following table presents the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis, excluding assets related to the Company’s defined benefit pension plans, classified by the level within the fair value hierarchy (in thousands):
|  | June 30, 2020 |  | March 31, 2020
|  | Level 1 |  | Level 2 |  | Level 3 |  | Level 1 |  | Level 2 |  | Level 3
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash equivalents |  | $ | 268,405 |  |  | $ | — |  |  | $ | — |  |  | $ | 564,952 |  |  | $ | — |  |  | $ | — |
Trading investments for deferred compensation plan included in other assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash |  | $ | 706 |  |  | $ | — |  |  | $ | — |  |  | $ | 846 |  |  | $ | — |  |  | $ | — |
Money market funds |  | 8,539 |  |  | — |  |  | — |  |  | 7,147 |  |  | — |  |  | — |
Mutual funds |  | 13,666 |  |  | — |  |  | — |  |  | 12,092 |  |  | — |  |  | — |
Total of trading investments for deferred compensation plan |  | $ | 22,911 |  |  | $ | — |  |  | $ | — |  |  | $ | 20,085 |  |  | $ | — |  |  | $ | — |
Currency exchange derivative assets included in other current assets |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 129 |  |  | $ | — |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |
Contingent consideration for business acquisition included in accrued and other current liabilities |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 23,284 |
Currency exchange derivative liabilities included in accrued and other current liabilities |  | $ | — |  |  | $ | 2,807 |  |  | $ | — |  |  | $ | — |  |  | $ | 719 |  |  | $ | — |
The following table summarizes the change in the fair value of the Company's contingent consideration balance during the three months ended June 30, 2020 (in thousands):
| Three Months Ended June 30,
Beginning of the period | $ | 23,284 |
Change in fair value of contingent consideration | 5,716 |
End of the period (1) | $ | 29,000 |
(1) As of June 30, 2020, the earn-out period is complete. The earn-out payment of $29.0 million is based on the actual net sales of Streamlabs services and no longer subject to fair value measurement and was accordingly transferred out of Level 3. The expected earn-out payment is included in the accrued and other current liabilities of the unaudited condensed consolidated balance sheet. Investment Securities The marketable securities for the Company's deferred compensation plan were recorded at a fair value of $22.9 million and $20.1 million, as of June 30, 2020 and March 31, 2020, respectively, based on quoted market prices. Quoted market prices are observable inputs that are classified as Level 1 within the fair value hierarchy. Unrealized gains (losses) related to trading securities for the three months ended June 30, 2020 and 2019 were not material and are included in other income, net in the Company's condensed consolidated statements of operations. Contingent Consideration for Business Acquisition On October 31, 2019 (the "Streamlabs Acquisition Date"), the Company acquired all of the equity interests of General Workings, Inc. ("Streamlabs"). The contingent consideration for business acquisition arising from the Streamlabs Acquisition represents the future potential earn-out payments of $29.0 million payable in stock only upon the achievement of certain net sales for the period beginning on January 1, 2020 and ending on June 30, 2020. The fair value of the earn-out as of the Streamlabs Acquisition Date was $0.04 million, and increased to $23.3 million as of March 31, 2020, which was determined by using a Black-Scholes-Merton valuation model to calculate the probability of the earn-out threshold being met and times the value of the earn-out payment, and discounted at the risk-free rate. The valuation included significant assumptions and unobservable inputs such as the projected sales of Streamlabs over the earn-out period, the risk-free rate, and the net sales volatility. The fair value was increased by $5.7 million to $29.0 million as of June 30, 2020, based on actual sales. The stock payout is expected to be $29.0 million. The fair value of the contingent consideration no longer needs to be remeasured at each reporting period, as the earn-out period has been completed. Equity Method Investments The Company has certain non-marketable investments included in other assets that are accounted for under the equity method of accounting, with a carrying value of $42.3 million and $42.1 million as of June 30, 2020 and March 31, 2020, respectively. Assets Measured at Fair Value on a Nonrecurring Basis Financial Assets. The Company has certain investments without readily determinable fair values due to the absence of quoted market prices, the inherent lack of liquidity, and the fact that inputs used to measure fair value are unobservable and require management's judgment. When certain events or circumstances indicate that impairment may exist, the Company revalues the investments using various assumptions, including the financial metrics and ratios of comparable public companies. The carrying value is also adjusted for observable price changes with a same or similar security from the same issuer. The amount of these investments included in other assets as of June 30, 2020 and March 31, 2020 was $3.9 million. There was no impairment of these assets during the three months ended June 30, 2020 or 2019. Non-Financial Assets. Goodwill, intangible assets, property, plant and equipment, and notes receivable, are not required to be measured at fair value on a recurring basis. However, if certain triggering events occur (or tested at least annually for goodwill) such that a non-financial instrument is required to be evaluated for impairment and an impairment is recorded to reduce the non-financial instrument's carrying value to the fair value as a result of such triggering events, the non-financial assets and liabilities are measured at fair value for the period such triggering events occur. There was no impairment of these assets during the three months ended June 30, 2020 or 2019.

X
- Definition The entire disclosure for financial instruments. This disclosure includes, but is not limited to, fair value measurements of short and long term marketable securities, international currencies forward contracts, and auction rate securities. Financial instruments may include hedging and non-hedging currency exchange instruments, derivatives, securitizations and securities available for sale at fair value. Also included are investment results, realized and unrealized gains and losses as well as impairments and risk management disclosures. + References No definition available. + Details
Name: | us-gaap_FinancialInstrumentsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_FinancialInstrumentsOwnedAtFairValueAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration