If you think the year 2018 has been the year of many changes in fair value reporting and disclosures, wait to you see what’s in store for 2019. Many organizations, both in the valuation space and other allied fields, have promulgated new rules and standards that will require valuators to be current in their research. Let’s take a brief look at the happenings for 2019.
In the Pension Plan arena, for instance, both pension plan investors and managers will need to improve valuation rigor and expand due diligence. This will require these managers to document due diligence in a more formal manner.
In the Hedge Fund world, the Alternative Investment Management Association will require a stronger focus on the valuation of debt investments and less reliance on pricing services.
In the accounting world, the AICPA issued a working draft of an accounting and valuation guide, titled, “Valuation of Portfolio Company Investments of Venture Capital and Private Equity Funds and Other Investment Companies” which also emphasizes consistency in valuing debt and equity investments.
The International Valuation Standards Council are creating standards for valuing financial instruments — with a focus on governance, framework, data sources and the impact on financial reporting.
These changes are just some of the items to look forward to in 2019.
Until next year, have an awesome holiday season!