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To explain the new U.S. Securities and Exchange Commission (“SEC”) Rule 2a-5 (the “Fair Value Rule”) under the Investment Company Act of 1940 (the “1940 Act”), which addresses the valuation practices of registered investment companies and business development companies.

Provides an overview of the Fair Value Rule, followed by a more detailed summary of the key provisions, including relevant guidance provided by the SEC in the release adopting the Fair Value Rule.

The Fair Value Rule establishes a specific framework, a standard of baseline practices across funds, and a set of required functions that must be performed in order to determine in good faith the fair value of a fund’s investments for purposes of applying Section 2(a)(41) of the 1940 Act.

Practical guidance from experienced investment management lawyers.

This paper aims to present the rules for determining the net asset value according to the AIFM Directive which have fundamentally changed regulation of the European alternative funds industry. The paper discusses how these rules must be applied to ensure a reliable and objective valuation and to protect the interests of investors.

The paper draws upon experience gained in the market following the implementation of rules on fund valuation in the European Union in 2011 and further in Germany in 2013. The valuation rules for relevant asset classes are presented and discussed in the light of the overarching goal of investor protection.

The paper’s findings show that the market participants saw the increased requirements as an opportunity and that they have adapted to the new system. This also applies to fund valuation, even though some people criticise terminology, lack of clarity and the complexity of the new valuation scheme from a practical perspective. Also, due to the increased valuation requirements, a consolidation among market participants can be expected.

The issues addressed in the paper are currently the subject of debate by regulators and market participants. There are direct implications for future prudential regulation in the asset management industry.

To describe the application of fair value methodologies to fund operations and emphasize the importance of appropriate valuation procedures.

Discusses the need for appropriate valuation methodologies, describes a recent survey that shows how fair valuation policies and procedures have evolved over time, recommends procedures for adoption of consistent valuation procedures and industry practices, explains recent fund management trends such as the creation of separate valuation committees and the use of third‐party pricing vendors, and warns that valuation is becoming a more frequent subject of SEC examinations.

Concludes that investment companies, private investment companies, boards, and managements are re‐evaluating and updating their valuation policies and procedures, partly in response to increased focus on valuations by the SEC in its examinations.

Provides the results of a useful survey on fair value methodologies and important considerations for fund managers and directors as they review and update their valuation methodologies and procedures.

The fundamental change in accounting rules for equity-based compensation (EBC) instituted by SFAS 123, SFAS 123r, and IFRS 2 has allowed for new insights related to a variety of research questions. This paper discusses the empirical evidence generated in the wake of the new regulation and categorizes it into two broad streams. The first stream encompasses research on the changed use of EBC and the incentives provided. The second stream addresses how firms account for EBC, including the underreporting phenomenon and how it was affected by the mandatory recognition of EBC expenses. I discuss where research delivers unanimous findings versus contradictory results. Using these insights, I make recommendations for further research opportunities in the area of EBC.

The globalization of trade and markets requires international standards governing accounting and associated activities including valuation. The EU Financial Services Action Plan and the revised banking supervision rules both spotlight the need for consistent standards. Valuation standards exist at the international (IVSC), European (TEGoVA) and professional (RICS) levels. Differences of tradition and approach nevertheless still exist covering fundamental issues such as bases of value. Traditional valuation practice in many EU states therefore faces a process of swift harmonization. This paper examines, for one EU country, the degree of variation between valuation standards and current practice. Results are presented of the first ever survey of the professional practice of Portuguese valuers. Survey results reveal a largely part‐time profession, which appears to be poorly equipped to meet the challenge outlined above.

The purpose of this paper is to analyze media storytelling and rhetoric surrounding the credibility of the longstanding accounting practice of mark‐to‐market valuation.

The cascading storytelling model of progressive framing by the media of mark‐to‐market valuation was applied to story subsets of the three types of classic Aristotelian rhetorical appeals.

The authors found that the media blamed the accounting profession's mark‐to‐market valuation practices as substantive cause of recent corporate problems and declines in market values. In addition, the rhetorical framing of mark‐to‐market accounting practices in the media prompted the Financial Accounting Standards Board to a rush to judgment.

The paper is limited to the analysis of the storytelling included. Different results from other sources may provide another result.

The failure in the media to address the duality between the logos of accounting and the ethos of the media narratives exacerbated the cascading activation. Understanding this duality may provide a different lens in looking at information dissemination. This is not only relative to stakeholders in making more informed decisions but should also serve as a warning to the profession, to have more voice, to use a rhetorical strategy that can have more saliency in the public arena.

The paper examined storytelling as interplay of retrospective narrative, the presentness of living story, and the antenarratives shaping the future of not only the unfolding economic crisis, but the future of accounting itself. In terms of rhetoric, we extended the application of pathos, ethos, and logos by examining a cascading activation theory model. This is one of the few studies of antenarratives and how through cascade rhetoric the future is shaped.

Examines the origins, objectives and achievements of the European Group of Valuers of Fixed Assets. Discusses the principles and contents of the European Guidance Notes on the Valuation of Fixed Assets. Concludes that there is now a consensus among valuation professionals involved internationally that they must work to a commonality of valuation certificate.

The purpose of this research is to examine the accounting output of the reformed financial accounting system of municipalities in Belgium, particularly in Flanders. For the first time ever in Belgian governments, an accounting reform transferred from business accounting was imposed. The research hypothesizes that the level of material comparability of the accounting output is very poor in spite of the strict accounting regulations. The empirical results indicate that the annual accounts are actually incomparable in many respects and that these problems cannot be explained away by a lack of experience.

This paper proposes a framework to facilitate description of national financial accounting systems. Its first element, broad aims, identifies the fundamental purpose of national financial accounting systems as being to effect a macro‐user or micro‐user orientation. From this emerges the second element, institutional environment, which describes the nature of regimes put in place to effect regulation. This influences the third element, the specific accounting rules and practices adopted. Aspects of international practice relating to each of these three elements are illustrated. The pedagogical benefits of the framework are demonstrated. The standard vocabulary and the structured format of the framework is used to describe, in capsule form, the national financial accounting systems of Korea and Indonesia. The framework seems likely to enhance understanding of the similarities and differences in national financial accounting systems and to contribute useful insights to international accounting matters.