Quarterly report pursuant to Section 13 or 15(d)

Fair Value

v2.4.0.8
Fair Value
9 Months Ended
Sep. 30, 2014
Fair Value Disclosures [Abstract]  
Fair Value
Fair Value
 
We record cash equivalents and short-term investments at fair value. Fair value is an exit price, representing the amount that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. Fair value measurements are required to be disclosed by level within the following fair value hierarchy:
 
Level 1 — Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.
 
Level 2 — Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life.
 
Level 3 — Inputs lack observable market data to corroborate management’s estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.
 
When determining fair value, whenever possible we use observable market data and rely on unobservable inputs only when observable market data is not available.
 
The fair value of these financial assets and liabilities was determined using the following inputs at December 31, 2013 and September 30, 2014:
 
 
As of December 31, 2013
 
Fair Value Measurement Using
 
Quoted Prices in
 
Significant
 
 
 
Active Markets
for Identical
Instruments
(Level 1)
 
Other
Observable
Inputs
(Level 2)
 
Total
 
(in thousands)
Assets:
 

 
 

 
 

Money market funds
$
98,437

 
$

 
$
98,437

Commercial paper

 
101,773

 
101,773

Corporate debt securities

 
155,021

 
155,021

U.S. government and government agency debt securities

 
5,696

 
5,696

Total assets measured at fair value
$
98,437

 
$
262,490

 
$
360,927

 
As of September 30, 2014
 
Fair Value Measurement Using
 
Quoted Prices in
 
Significant
 
 
 
Active Markets
for Identical
Instruments
(Level 1)
 
Other
Observable
Inputs
(Level 2)
 
Total
 
(in thousands)
Assets:
 

 
 

 
 

Money market funds
$
91,780

 
$

 
$
91,780

Commercial paper

 
60,743

 
60,743

Corporate debt securities

 
220,707

 
220,707

U.S. government and government agency debt securities

 
13,104

 
13,104

Total assets measured at fair value
$
91,780

 
$
294,554

 
$
386,334


 
Our money market funds are classified as Level 1 within the fair value hierarchy because they are valued primarily using quoted market prices. Our other cash equivalents and short-term investments are classified as Level 2 within the fair value hierarchy because they are valued using professional pricing sources for identical or comparable instruments, rather than direct observations of quoted prices in active markets. As of December 31, 2013 and September 30, 2014, we held no Level 3 assets or liabilities.