ServiceMagic 2014 Annual Report Download - page 89

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IAC/INTERACTIVECORP AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
The following table presents the changes in the Company's financial instruments that are measured at fair value on a recurring basis using
significant unobservable inputs (Level 3):
Auction rate security
The Company's auction rate security is valued by discounting the estimated future cash flow streams of the security over the life of the
security. Credit spreads and other risk factors are also considered in establishing fair value. The cost basis of the auction rate security is $10.0
million , with a gross unrealized loss of $3.9 million and $1.1 million at December 31, 2014 and December 31, 2013 , respectively. The unrealized
losses are included in "Accumulated other comprehensive loss" in the accompanying consolidated balance sheet. At December 31, 2014 , the
auction rate security is rated BBB+ and matures in 2035. The Company does not consider the auction rate security to be other-than-temporarily
December 31, 2013
Quoted Market
Prices in Active
Markets for
Identical Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Total
Fair Value
Measurements
(In thousands)
Assets:
Cash equivalents:
Money market funds
$
698,307
$
—
$
—
$
698,307
Commercial paper
—
12,000
—
12,000
Time deposits
—
32,325
—
32,325
Marketable securities:
Corporate debt security
—
1,008
—
1,008
Equity securities
4,996
—
—
4,996
Long-term investments:
Auction rate security
—
—
8,920
8,920
Marketable equity securities
11,711
—
—
11,711
Total
$
715,014
$
45,333
$
8,920
$
769,267
Liabilities:
Contingent consideration arrangements
$
—
$
—
$
(
45,828
)
$
(45,828
)
For the Year Ended
December 31, 2014
December 31, 2013
Auction Rate
Security
Contingent
Consideration
Arrangements
Auction Rate
Security
Contingent
Consideration
Arrangements
(In thousands)
Balance at January 1
$
8,920
$
(45,828
)
$
8,100
$
(1,909
)
Total net gains (losses):
Included in earnings
—
13,367
—
(
343
)
Included in other comprehensive (loss) income
(2,850
)
3,025
820
(2,445
)
Fair value at date of acquisition
—
(
8,813
)
—
(
41,387
)
Settlements
—
8,109
—
256
Balance at December 31
$
6,070
$
(30,140
)
$
8,920
$
(45,828
)