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The fair value disclosure requirements for both recurring and nonrecurring measurements are discussed in the following sections:
  • General disclosure requirements - Figure FSP 20-1
  • Disclosures specific to valuation techniques and significant inputs - Figure FSP 20-2
  • Disclosures for investments measured at net asset value - FSP 20.4
  • Disclosures for financial instruments not measured at fair value - FSP 20.5
  • Disclosures for instruments under the fair value option - FSP 20.6

The disclosure requirements in ASC 820 are intended to provide information about the following:
  • The valuation techniques and inputs used to measure fair value, including judgments and assumptions made
  • The uncertainty in the fair value measurements as of the reporting date
  • How changes in fair value measurements affect performance and cash flows

To increase consistency and comparability in fair value measurements, the fair value standard establishes a hierarchy (addressed in FV 4) to prioritize the inputs used in valuation techniques. The level in the fair value hierarchy and the significant inputs used in a fair value measurement are two of the fundamental disclosure requirements of ASC 820. Further, disclosure requirements are largely based on the level in the hierarchy. As the level decreases, disclosure requirements increase, and certain required disclosures are applicable only to Level 3 fair value measurements.

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