ASURE SOFTWARE INCASUR
ASURE SOFTWARE INC Fair Value Disclosure
INVESTMENTS AND FAIR VALUE MEASUREMENTS
ASC 820 “Fair Value Measurement” (ASC 820) defines fair value, establishes a framework for measuring fair value under U.S. GAAP and enhances disclosures about fair value measurements. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 describes a fair value hierarchy based on the following three levels of inputs that may be used to measure fair value, of which the first two are considered observable and the last unobservable:
| Level 1: | Quoted prices in active markets for identical assets or liabilities; | |||||||
| Level 2: | Quoted prices in active markets for similar assets or liabilities; quoted prices in markets that are not active for identical or similar assets or liabilities; and model-driven valuations whose significant inputs are observable; and | |||||||
| Level 3: | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. | |||||||
The following table presents the fair value hierarchy for our financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2025, and December 31, 2024, respectively (in thousands):
| Total Carrying Value | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||
| December 31, 2025 | |||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Funds held for clients | |||||||||||||||||||||||
| Money market funds | $ | 1,784 | $ | 1,784 | $ | — | $ | — | |||||||||||||||
| Available-for-sale securities | 88,652 | — | 88,652 | — | |||||||||||||||||||
| Total | $ | 90,436 | $ | 1,784 | $ | 88,652 | $ | — | |||||||||||||||
| December 31, 2024 | |||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Funds held for clients | |||||||||||||||||||||||
| Money market funds | $ | 8,105 | $ | 8,105 | $ | — | $ | — | |||||||||||||||
| Available-for-sale securities | 68,328 | — | 68,328 | — | |||||||||||||||||||
| Total | $ | 76,433 | $ | 8,105 | $ | 68,328 | $ | — | |||||||||||||||
Restricted cash equivalents and investments classified as available-for-sale within funds held for clients consisted of the following (in thousands):
| Amortized Cost | Gross Unrealized Gains (1) | Gross Unrealized Losses (1) | Aggregate Estimated Fair Value | ||||||||||||||||||||
| December 31, 2025 | |||||||||||||||||||||||
| Restricted cash equivalents | $ | 1,787 | $ | — | $ | (3) | $ | 1,784 | |||||||||||||||
| Available-for-sale securities: | |||||||||||||||||||||||
| Corporate debt securities | 83,160 | 501 | (77) | 83,584 | |||||||||||||||||||
| Municipal bonds | 1,542 | — | (17) | 1,525 | |||||||||||||||||||
| U.S. Government agency securities | 3,515 | 28 | — | 3,543 | |||||||||||||||||||
| Total available-for-sale securities | 88,217 | 529 | (94) | 88,652 | |||||||||||||||||||
Total(2) | $ | 90,004 | $ | 529 | $ | (97) | $ | 90,436 | |||||||||||||||
| December 31, 2024 | |||||||||||||||||||||||
| Restricted cash equivalents | $ | 8,115 | $ | — | $ | (10) | $ | 8,105 | |||||||||||||||
| Available-for-sale securities: | |||||||||||||||||||||||
| Corporate debt securities | 63,253 | 164 | (619) | 62,798 | |||||||||||||||||||
| Municipal bonds | 3,194 | — | (104) | 3,090 | |||||||||||||||||||
| U.S. Government agency securities | 2,449 | 6 | (15) | 2,440 | |||||||||||||||||||
| Total available-for-sale securities | 68,896 | 170 | (738) | 68,328 | |||||||||||||||||||
Total(2) | $ | 77,011 | $ | 170 | $ | (748) | $ | 76,433 | |||||||||||||||
(1)Unrealized gains and losses on available-for-sale securities are included as a component of comprehensive loss. As of December 31, 2025, and December 31, 2024, there were 127 and 45 securities, respectively, in an unrealized gain position and there were 27 and 89 securities in an unrealized loss position, respectively. As of December 31, 2025, these unrealized losses were less than $13 individually and $94 in the aggregate. As of December 31, 2024, these unrealized losses were less than $38 individually and $738 in the aggregate. We invest in high quality securities with roughly 71% of our portfolio made up of A ratings and above with unrealized losses primarily attributable to macroeconomic factors rather than credit related. We have no material individual securities that have been in a continuous unrealized loss position greater than twelve months. We do not intend to sell these investments, and we do not expect to sell these investments before recovery of their amortized cost basis, which may be at maturity. We review our investments to identify and evaluate investments that indicate possible credit losses. Factors considered in determining whether a loss is a credit loss include the length of time and extent to which fair value has been less than the cost basis, the financial condition and near-term prospects of the investee, and our intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value.
(2)At December 31, 2025, and December 31, 2024, none of these securities were classified as cash and cash equivalents on the accompanying Consolidated Balance Sheets.
Funds held for clients represent assets that we have classified as restricted for use solely for the purposes of satisfying the obligations to remit funds relating to our payroll and payroll tax filing services, which are classified as client funds obligations on our Consolidated Balance Sheets.
Funds held for clients have been invested in the following categories (in thousands):
| December 31, 2025 | December 31, 2024 | ||||||||||
| Restricted cash and cash equivalents held to satisfy client funds obligations | $ | 139,459 | $ | 124,287 | |||||||
| Restricted short-term marketable securities held to satisfy client funds obligations | 12,781 | 5,273 | |||||||||
| Restricted long-term marketable securities held to satisfy client funds obligations | 75,871 | 63,055 | |||||||||
| Total funds held for clients | $ | 228,111 | $ | 192,615 | |||||||
Expected maturities of available-for-sale securities as of December 31, 2025, are as follows (in thousands):
| One year or less | $ | 12,781 | |||
| After one year through five years | 75,871 | ||||
| $ | 88,652 | ||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 26, 2026 | Showing above |
| 2023 | Feb 26, 2024 | |
| 2022 | Feb 27, 2023 | |
| 2021 | Mar 14, 2022 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.