Nonpublic entities’ disclosures about Level 3 fair value measurements


Authored by RSM US LLP

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We have updated our white paper, Changes to the disclosure requirements for fair value measurements, which provides a summary of the fair value measurement disclosure requirements in Topic 820, “Fair Value,” of the Financial Accounting Standards Board’s Accounting Standards Codification (ASC), as amended by Accounting Standards Update (ASU) 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. The update provides clarification of the information a nonpublic entity is required to disclose about significant unobservable inputs used to develop Level 3 fair value measurements.

The amendments to ASC 820 made by ASU 2018-13 are effective for all entities for fiscal years, and interim periods therein, beginning after December 15, 2019. As such, for a private company with a calendar year end that does not prepare interim financial statements, the changes are effective in its financial statements for the year ending December 31, 2020.

Refer to our white paper for a summary of all the fair value measurement disclosure requirements in ASC 820 that were and were not affected by ASU 2018-13.