SEC Officials Address Fair Value Rules for Private Assets

Senior Securities and Exchange Commission officials have issued a formal statement addressing fair value measurement and disclosure considerations specifically aimed at private assets, signaling heightened regulatory attention to how investment funds value illiquid holdings.

The statement was issued jointly by Kurt Hohl, the SEC's Chief Accountant, and Brian Daly, Director of the Division of Investment Management — two of the agency's most senior officials overseeing financial reporting and fund oversight. The pairing underscores the cross-divisional nature of the concerns being raised.

Read more SEC Charges Zoe Financial for Hiding Adviser Conflicts →

Fair value measurement of private assets has grown increasingly important as institutional investors, including private equity and private credit funds, have expanded their allocations to illiquid markets. Unlike publicly traded securities, private assets lack readily observable market prices, making consistent and transparent valuation a persistent challenge for both managers and regulators.

The SEC's focus on this area reflects broader concerns that investors may not always receive adequate disclosure about how fund managers arrive at valuations for hard-to-price holdings — a gap that can obscure risk and affect investor decision-making. Regulatory scrutiny in this space has intensified in recent years as private markets have grown substantially in size and retail investor access has widened.

The full details of the officials' guidance, including specific measurement frameworks and disclosure expectations, are outlined in the complete statement. Continue reading at Speeches and Statements.