FASB Issues Proposed Clarification to Fair Value Disclosure Exemption Affecting Private Companies and Nonpublic Not-for-Profit Organizations

Norwalk, CT, January 7, 2013—The Financial Accounting Standards Board (FASB) today issued for public comment a proposed Accounting Standards Update intended to clarify the scope and applicability of a disclosure exemption that is specific to private companies and nonpublic not-for-profit organizations that resulted from the issuance of Accounting Standards Update No. 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs. Stakeholders are asked to review and provide comments on the proposal by January 22, 2013.

The proposed amendment would clarify that the requirement to disclose “the level of the fair value hierarchy within which the fair value measurements are categorized in their entirety (Level 1, 2, or 3)” does not apply to private companies and nonpublic not-for-profit organizations for items that are not measured at fair value in the statement of financial position, but for which fair value is disclosed.

The proposed Update is available for review and comment at

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Since 1973, the Financial Accounting Standards Board has been the designated organization in the private sector for establishing standards of financial accounting and reporting. Those standards govern the preparation of financial reports and are officially recognized as authoritative by the Securities and Exchange Commission and the American Institute of Certified Public Accountants. Such standards are essential to the efficient functioning of the economy because investors, creditors, auditors, and others rely on credible, transparent, and comparable financial information. For more information about the FASB, visit our website at