Insight

SEC modernizes regulatory framework for fund valuation

Simplifying regulatory requirements, facilitating board oversight, and maintaining fair value integrity

Sean McKee

Sean McKee

Partner, Audit, KPMG US

+1 609-947-2529

Matt Giordano

Matt Giordano

Partner, Audit, KPMG US

+1 617-988-6327

The Securities and Exchange Commission (SEC) has issued the final rule modifying the valuation practices and the role of the board of directors in determining the fair value of investments held by a registered investment company or a business development company. 

The rule, released December 3, 2020, provides requirements for determining fair value in good faith by the board of directors and recordkeeping.

Download the article to learn more about the requirements, which involve:

  • Periodically assessing and managing material valuation risks associated with fair value determinations
  • Establishing, applying, and testing fair value methodologies
  • Overseeing and evaluating pricing services used
  • Recordkeeping