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Certain of the fair value disclosures are not required for nonpublic entities. The fair value standard refers to the first definition of a “nonpublic entity” in the Master Glossary of the FASB Codification.

Definition from ASC Master Glossary

Nonpublic Entity: Any entity that does not meet any of the following conditions:
  1. Its debt or equity securities trade in a public market either on a stock exchange (domestic or foreign) or in an over-the-counter market, including securities quoted only locally or regionally.
  2. It is a conduit bond obligor for conduit debt securities that are traded in a public market (a domestic or foreign stock exchange or an over the counter market, including local or regional markets).
  3. It files with a regulatory agency in preparation for the sale of any class of debt or equity securities in a public market.
  4. It is required to file or furnish financial statements with the Securities and Exchange Commission.
  5. It is controlled by an entity covered by criteria (a) through (d).

Under ASC 820-10-50-2F, the disclosures not required for nonpublic entities include:
  • The range and weighted average of significant unobservable inputs (ASC 820-10-50-2(bbb)(2)(i))
  • The changes in unrealized gains or losses in income and OCI for the period (ASC 820-10-50-2(d))
  • Information about the uncertainty of Level 3 fair value measurements to changes in unobservable inputs and interrelationships between those unobservable inputs (ASC 820-10-50-2(g))

Also, instead of a full rollforward of Level 3 instruments, ASC 820-10-50-2G requires nonpublic entities to disclose the following for each class of investments:
  • Purchases and issuances (each disclosed separately
  • Transfers into or out of Level 3 and the reasons for those transfers

Like public companies, nonpublic entities must consistently follow their policy for determining when transfers are deemed to have occurred and disclose transfers into Level 3 separate from transfers out of Level 3.

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