Nonpublic companies that measure and record assets or liabilities at fair value need to provide additional fair value disclosures starting with annual financial statements for years beginning on or after December 15, 2011. The additional required disclosures for nonpublic companies are not as extensive as the requirements for public companies; however management may wish to consider if inclusion of the incremental disclosures required of public companies would be useful to their financial statement users as well.
The table below, part of Mayer Hoffman McCann’s most recent MHM Messenger, summarizes the significant differences in fair value disclosure requirements for public and nonpublic entities.
For more details on this topic or guidance on how to prepare the required and optional disclosures listed in the table, see the full MHM Messenger 3-13: Additional Fair Value Disclosures for Nonpublic Companies.
In addition, to help companies of all sizes and industries enhance their understanding of these complexities, we recently held a course on financial instruments as part of the MHM Executive Education Series. A recording and materials from the presentation can be found on the MHM website.