SEC Issues "Important Reminder" on Hard-to-Value Private Assets

Odaily News: As private assets become difficult to sell and investor redemption requests surge, Wall Street's main financial regulator is urging the financial industry to step up its efforts in valuing such assets. The U.S. Securities and Exchange Commission (SEC) on Monday issued a statement regarding existing regulatory requirements. Although it did not propose new rules, it is viewed as a "key reminder." This signals that the agency will focus on how firms determine the value of their holdings and how they disclose these values and related risks to investors.

The SEC's Office of the Chief Accountant and the Division of Investment Management said in a joint statement: "Across the valuation and disclosure topics discussed in this statement, the core message is consistent: sound policies and procedures, combined with adequate material disclosure, help investors understand an entity's fair value assessment process, the judgments involved, and the risks associated with private assets."