Fair value of financial assets and liabilitiesThe following tables present information about the Company’s financial assets and liabilities measured at fair value on a recurring basis:
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| Fair Value Measurements as of March 31, 2025 Using: |
| Level 1 | | Level 2 | | Level 3 | | Total |
| Cash equivalents: | | | | | | | |
| Money market funds | $ | — | | | $ | 89,879 | | | $ | — | | | $ | 89,879 | |
| Short-term investments: | | | | | | | |
| US Government Agency bonds | — | | | 84,804 | | | — | | | 84,804 | |
| US Treasury bonds | — | | | 287,881 | | | — | | | 287,881 | |
| $ | — | | | $ | 462,564 | | | $ | — | | | $ | 462,564 | |
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| Fair Value Measurements as of March 31, 2024 Using: |
| Level 1 | | Level 2 | | Level 3 | | Total |
| Cash equivalents: | | | | | | | |
| Money market funds | $ | — | | | $ | 41,077 | | | $ | — | | | $ | 41,077 | |
| Short-term investments: | | | | | | | |
| US Government Agency bonds | — | | | 199,821 | | | — | | | 199,821 | |
| US Treasury bonds | — | | | 146,390 | | | — | | | 146,390 | |
| $ | — | | | $ | 387,288 | | | $ | — | | | $ | 387,288 | |
The underlying securities held in the money market funds held by the Company are all government backed securities. During the years ended March 31, 2025 and 2024, there were no transfers between levels.
Valuation of cash equivalents and short-term investments
Money market funds, U.S. Treasury bonds and U.S. Government Agency bonds were valued by the Company using quoted prices in active markets for similar securities, which represent a Level 2 measurement within the fair value hierarchy. Cash equivalents consisted of money market funds at March 31, 2025 and March 31, 2024.
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.