FASB proposes fair value disclosures for 2009

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01 Sep 2009

The US Financial Accounting Standards Board (FASB) has issued an exposure draft (ED) of a proposed Accounting Standards Update intended to improve disclosures about fair value (FV) measurements.

Proposed new and revised disclosures include:
  1. Effect of reasonably possible alternative Level 3 measurements (measurements based on unobservable inputs) that could increase or decrease FV significantly – sometimes called sensitivity disclosures
  2. Transfers of assets or liabilities among Level 1, 2, and 3 measurements
  3. Information about gross purchases, sales, issuances, and settlements of assets or liabilities whose FV is measured using a Level 3 FV measurement
  4. Disaggregated disclosures of FV for each class of assets and liabilities
  5. Valuation techniques and inputs used to measure FV using Level 2 and 3 measurements
The proposed disclosures are similar to those already required by IFRS 7 Financial Instruments: Disclosures. With the exception of the sensitivity disclosures (item 1 above), the new disclosures would be required for interim and annual reporting periods ending after 15 December 2009. The Level 3 sensitivity disclosures would be effective for interim and annual reporting periods ending after 15 March 2010. FASB's deadline for comments on the proposals is 12 October 2009. Click for FASB News Release (PDF 98k). The news release includes a link to download the ED.


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