FASB Amends Disclosures for Investments in Certain Entities that Calculate Net Asset Value Per Share


By Lara Fuller

The Financial Accounting Standards Board (FASB) has recently issued an amendment related to disclosures for investments that calculate net asset value per share.  Under the current Fair Value Measurement, Topic 820, an entity may use, as a practical expedient, the net asset value per share of the investment to measure the fair value.  Currently, these investments are categorized within the fair value hierarchy table based on when the investment is redeemable with the investee at that net asset value.  These amendments remove the requirement to include investments that use net asset value per share as a practical expedient in the fair value hierarchy and also remove certain disclosures related to all investments that are eligible to be measured at fair value using the net asset value per share.  These amendments are effective for public entities for fiscal years beginning after December 15, 1015 and for all other entities, for fiscal years beginning after December 31, 2016.  The amendments should be applied retrospectively and early application is permitted. 1

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1 FASB Website

Material discussed is meant for informational purposes only, and it is not to be construed as investment, tax, or legal advice. Please note that individual situations can vary. Therefore, this information should be relied upon when coordinated with individual professional advice.

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