Andrew J. Taddei, Managing director in the Alternative Asset Advisory practice at Duff & Phelps and member of the American Institute of Certified Public Accountants’ (AICPA) Financial Instruments Task Force, wrote an article for the AIPCA titled, “Measuring the Fair Value of Financial Instruments Under Conditions of Significant Uncertainty–Selected Considerations.”
The article lists selected considerations for estimating fair value. The global COVID-19 pandemic has impacted the March 31, 2020 quarter-end valuation process and has posed a new challenge for management, valuation professionals, auditors and users of financial statements.
While the pandemic continues and the public markets sell off in response, sound judgment must be exercised in estimating fair value and in applying the concepts of the AICPA’s Financial Instruments Performance Framework (FIPF). This is especially true for investments with limited or no trading activity. By keeping in mind a few basic premises, management and valuation professionals can stay on the path to credible, supportable valuations in times of market dislocations.
Read the full article here.
