Quarterly report pursuant to Section 13 or 15(d)

4. INVESTMENT SECURITIES, AVAILABLE-FOR-SALE AND FAIR VALUE MEASUREMENTS

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4. INVESTMENT SECURITIES, AVAILABLE-FOR-SALE AND FAIR VALUE MEASUREMENTS
6 Months Ended
Jun. 30, 2022
Investments, All Other Investments [Abstract]  
4. INVESTMENT SECURITIES, AVAILABLE-FOR-SALE AND FAIR VALUE MEASUREMENTS

4. INVESTMENT SECURITIES, AVAILABLE-FOR-SALE AND FAIR VALUE MEASUREMENTS

 

Our investment securities, available-for-sale are comprised of corporate and government debt securities. The principal markets for the debt securities are dealer markets which have a high level of price transparency. The market participants for debt securities are typically large money center banks and regional banks, brokers, dealers, pension funds, and other entities with debt investment portfolios.

 

Fair value is defined as the exchange price that would be received for 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. As a basis for considering such assumptions, the authoritative guidance establishes a three level fair value inputs hierarchy and requires an entity to maximize the use of observable valuation inputs and minimize the use of unobservable inputs. We use market data, assumptions and risks we believe market participants would use in measuring the fair value of the asset or liability, including the risks inherent in the inputs and the valuation techniques. The hierarchy is summarized below.

 

Level 1 - Quoted prices in active markets for identical assets and liabilities at the measurement date that the reporting entity has the ability to access.

 

 

Level 2 - Observable inputs other than quoted 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 for which there is little or no market data, which requires us to develop our own assumptions, which are significant to the measurement of the fair values.

 

The valuation inputs hierarchy classification for assets measured at fair value on a recurring basis are summarized below as of June 30, 2022 and December 31, 2021 (in thousands). These tables do not include cash held in our money market savings accounts.

 

 

As of June 30, 2022     Level 1     Level 2     Level 3     Total
Assets                        
    Corporate debt securities   $        -   $       29,006   $        -   $   29,006
    U.S. Treasury securities     -     26,920     -     26,920
    $        -   $       55,926   $        -   $   55,926

 

As of December 31, 2021     Level 1     Level 2     Level 3     Total
Assets                        
    Corporate debt securities   $        -   $       32,720   $        -   $   32,720
    $        -   $       32,720   $        -   $   32,720

 

 

Our short-term investments are summarized below as of June 30, 2022 and December 31, 2021 (in thousands).

 

 

                        Investment
      Cost/     Gross     Gross     Securities,
      Amortized     Unrealized     Unrealized     Available-
      Cost     Gains     Losses     For-Sale
As of June 30, 2022                        
Assets                        
    Corporate debt securities   $ 29,118   $       3   $    (115)   $   29,006
    U.S. Treasury securities     26,986     -     (66)     26,920
    $ 56,104   $       3   $    (181)   $   55,926

 

                        Investment
      Cost/     Gross     Gross     Securities,
      Amortized     Unrealized     Unrealized     Available-
      Cost     Gains     Losses     For-Sale
As of December 31, 2021                        
Assets                        
    Corporate debt securities   $ 32,739   $       3   $    (22)   $   32,720
    $ 32,739   $       3   $    (22)   $   32,720

 

 

The maturities of the investment securities available-for-sale as of June 30, 2022 and December 31, 2021 are shown below (in thousands):

 

 

            Gross     Gross      
As of June 30, 2022     Amortized     Unrealized     Unrealized     Estimated
Maturity date     Cost     Gains     Losses     Fair Value
                         
    Less than one year   $       56,104   $       3   $    (181)   $   55,926
    $       56,104               $   55,926

 

 

            Gross     Gross      
As of December 31, 2021     Amortized     Unrealized     Unrealized     Estimated
Maturity date     Cost     Gains     Losses     Fair Value
                         
    Less than one year   $       32,739   $       3   $    (22)   $   32,720
    $       32,739               $   32,720

 

 

 

The following table summarizes investments that have been in a continuous unrealized loss position for less than 12 months and those that have been in a continuous unrealized loss position for more than 12 months as of June 30, 2022 and December 31, 2021 (in thousands):

 

 

      Less than Twelve Months     Twelve Months or Greater     Total
As of June 30, 2022           Gross           Gross           Gross
      Fair     Unrealized     Fair     Unrealized     Fair     Unrealized
      Value     Losses     Value     Losses     Value     Losses
                                     
    Corporate debt securities   $  26,004   $  (115)   $  -   $  -   $  26,004   $  (115)
    U.S. Treasury securities     26,920     (66)     -     -     26,920     (66)
    $       52,924   $  (181)   $  -   $  -   $   52,924   $  (181)

 

 

      Less than Twelve Months     Twelve Months or Greater     Total
As of December 31, 2021           Gross           Gross           Gross
      Fair     Unrealized     Fair     Unrealized     Fair     Unrealized
      Value     Losses     Value     Losses     Value     Losses
                                     
    Corporate debt securities   $       27,195   $    (22)   $        -   $   -   $   27,195   $        (22)
    $       27,195   $    (22)   $        -   $   -   $   27,195   $        (22)