Quarterly report pursuant to Section 13 or 15(d)

Fair Value Measurements

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Fair Value Measurements
6 Months Ended
Jun. 30, 2015
Fair Value Measurements  
Fair Value Measurements

 

(13)Fair Value Measurements

 

The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. Fair value measurements do not include transaction costs. A fair value hierarchy is used to prioritize the quality and reliability of the information used to determine fair values of each financial instrument. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined into the following three categories:

 

Level 1: Quoted market prices in active markets for identical assets or liabilities.

 

Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data.

 

Level 3: Unobservable inputs that are not corroborated by market data.

 

The following table presents the Company’s hierarchy for its assets, measured at fair value on a recurring basis, as of June 30, 2015:

 

 

 

Level 1

 

Level 2

 

Level 3

 

 

 

 

 

Quoted Prices
in Active
Markets for
Identical Assets

 

Significant
Other
Observable
Inputs

 

Significant
Unobservable
Inputs

 

Total

 

Investments available-for-sale

 

 

 

 

 

 

 

 

 

U.S. government security funds

 

$

1,781 

 

$

 

$

 

$

1,781 

 

Trading investment securities

 

1,131 

 

 

 

1,131 

 

 

 

 

 

 

 

 

 

 

 

Total assets measured at fair value on a recurring basis

 

$

2,912 

 

$

 

$

 

$

2,912 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The following table presents the Company’s hierarchy for its assets, measured at fair value on a recurring basis, as of December 31, 2014:

 

 

 

Level 1

 

Level 2

 

Level 3

 

 

 

 

 

Quoted Prices
in Active
Markets for
Identical Assets

 

Significant
Other
Observable
Inputs

 

Significant
Unobservable
Inputs

 

Total

 

Investments available-for-sale

 

 

 

 

 

 

 

 

 

Municipal obligations

 

$

 

$

101 

 

$

 

$

101 

 

U.S. government security funds

 

1,776 

 

 

 

1,776 

 

Equity securities

 

669 

 

 

 

669 

 

Trading investment securities

 

1,038 

 

 

 

1,038 

 

 

 

 

 

 

 

 

 

 

 

Total assets measured at fair value on a recurring basis

 

$

3,483 

 

$

101 

 

$

 

$

3,584 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments available-for-sale — The majority of the Company’s investment portfolio consist of various securities such as state and municipal obligations, U.S. government security funds, short-term deposits and various equity securities.  The Level 1 securities are valued using quoted prices for identical assets in active markets including equity securities and U.S. government treasuries.  The Level 2 securities include investments in state and municipal obligations whereby all significant inputs are observable or can be derived from or corroborated by observable market data for substantially the full term of the asset.

 

Trading investment securities — The majority of the Company’s trading portfolio consists of various marketable securities that are valued using quoted prices in active markets.

 

For the six months ended June 30, 2015, and for the year ended December 31, 2014, there were no fair value measurements using the significant unobservable inputs (Level 3).

 

The carrying amounts reflected on the consolidated balance sheet for cash and cash equivalents, accounts receivable, accounts payable and the revolving credit facility payable approximate fair value due to their short-term nature. During the six months ended June 30, 2015 and 2014, the Company did not have any re-measurements of non-financial assets at fair value on a nonrecurring basis subsequent to their initial recognition.