SEC Provides List of Fair Valuation Guidance
The SEC’s Division of Investment Management has issued a list of guidance materials for the fair valuation of securities. The “Select Bibliography” includes outlines of the applicable statutory provisions and rules, summaries of SEC releases, listings of applicable disclosure rules and staff guidance, and cross-references to a host of enforcement actions. The bibliography includes hyperlinks to source material. The list of materials is ostensibly for investment companies, but the materials are useful guidance for any firm required to fair value securities.
OUR TAKE: This bibliography is a great starting point for any firm creating or assessing its fair valuation procedures. The piece missing, though, is non-SEC guidance from trade groups (e.g. FAS and best practice guidelines from various private organizations. We hope this bibliography is a prelude to formal SEC guidance on fair valuation.