Quarterly report pursuant to Section 13 or 15(d)

Fair Value of Financial Assets and Liabilities

v3.19.2
Fair Value of Financial Assets and Liabilities
6 Months Ended
Jun. 30, 2019
Fair Value Disclosures [Abstract]  
Fair Value of Financial Assets and Liabilities

3. Fair Value of Financial Assets and Liabilities

The following table presents information about the Company’s financial assets that were carried at fair value on a recurring basis on the condensed consolidated balance sheet as of June 30, 2019 and December 31, 2018 and indicates the fair value hierarchy of the valuation inputs utilized to determine such fair value.

 

June 30, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

 

Total

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

Other asset – advance payment to supplier

 

$

2,833

 

 

 

 

 

 

 

 

 

2,833

 

December 31, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

 

Total

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

Short-term investments

 

$

40,000

 

 

 

40,000

 

 

 

 

 

 

 

Other asset – advance payment to supplier

 

 

2,649

 

 

 

 

 

 

 

 

 

2,649

 

Total

 

$

42,649

 

 

 

40,000

 

 

 

 

 

 

2,649

 

 

See Note 4 for further details on the short-term investments held. The other asset above relates to advance payments made to a supplier that were recorded at fair value using the discounted cash flow model (DCF), as of June 30, 2019 and December 31, 2018. The fair value measurements of these advance payments were determined based on significant unobservable inputs, including a discount rate of 15% and the expected time to recovery of the payment. Changes to the inputs described above are not expected to have a material impact on the company’s financial position and results of operations in any given period. See Note 12—Payments to Supplier, for further details on these advance payments.

The following table presents information about the Company’s long-term debt which was carried at amortized cost on the condensed consolidated balance sheet as of June 30, 2019, and December 31, 2018 and indicates the fair value hierarchy of the valuation inputs utilized to determine the approximate fair value.

 

June 30, 2019

 

 

 

 

 

Approximate

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

Book Value

 

 

Fair Value

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

Current portion of long-term debt

 

$

3,496

 

 

$

3,496

 

 

 

 

 

 

3,496

 

 

 

 

Long-term debt, less current portion

 

 

10,771

 

 

 

10,500

 

 

 

 

 

 

10,500

 

 

 

 

Total

 

$

14,267

 

 

$

13,996

 

 

 

 

 

 

13,996

 

 

 

 

December 31, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

Book Value

 

 

Approximate

Fair Value

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

Current portion of long-term debt

 

$

1,019

 

 

$

1,019

 

 

 

 

 

 

1,019

 

 

 

 

Long-term debt, less current portion

 

 

13,079

 

 

 

13,035

 

 

 

 

 

 

13,035

 

 

 

 

Total

 

$

14,098

 

 

$

14,054

 

 

 

 

 

 

14,054

 

 

 

 

The book value of the current portion of long-term debt approximates its fair value due to the short-term nature of the balance. The fair value of long-term debt, less current portion was determined based on a DCF analysis using quoted market interest rates, without consideration of transaction costs, which represents a Level 2 basis of fair value measurement. The counterparty to the long-term debt is a major international financial institution.

The carrying amounts reported in the condensed consolidated balance sheets for prepaid expenses and other current assets, accounts payable, accrued expenses and other current liabilities approximate their fair value based on the short-term maturity of these instruments.

There have been no transfers of assets or liabilities between the fair value measurement levels.