Changes Affecting the Investment Industry: Fair Value Measurement Disclosures– December 20, 2018 by Caroline Jiang

The FASB issued amendments to existing fair value measurement disclosure requirements in August 2018 that will affect the reporting requirements for hedge funds, private equity funds and 40 Act mutual funds. Accounting Standards Update (ASU) No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement eliminated, modified and added disclosure requirements. These changes had the largest impact on Level 3 fair value measurements.

Though not effective generally until 2020, entities have the option to early adopt, and even to only early adopt the disclosure eliminations and modifications and delay the adoption of the additional disclosures (which only affect public business entities).
 
The changes imposed by this ASU are expected to provide more cost-beneficial information to users of the financial statements and encourage discretion by entities when considering fair value measurement disclosures.
 
Changes in the disclosure requirements for fair value are summarized below. Note the requirements are effective for all entities for fiscal years beginning after December 15, 2019. Early adoption is permitted. Entities are allowed to early adopt the disclosure eliminations and modifications and delay the adoption of disclosure additions.

Please contact a member of your service team, or contact Caroline Jiang at caroline.jiang@cohencpa.com for further discussion. 
 

Cohen & Company is not rendering legal, accounting or other professional advice. Information contained in this post is considered accurate as of the date of publishing. Any action taken based on information in this blog should be taken only after a detailed review of the specific facts, circumstances and current law.