SEC issues reminder on valuation and disclosure for hard-to-price private assets

The U.S. Securities and Exchange Commission issued a statement on Monday reminding the financial industry to strengthen valuation work around private assets that have become harder to sell as redemption requests rise. The agency did not introduce new rules, but the statement was widely framed as an important reminder about existing regulatory requirements. The move signals that the SEC is paying close attention to how firms determine the value of assets they hold and how those valuations, along with related risks, are disclosed to investors. In a joint statement, the SEC’s Office of the Chief Accountant and Division of Investment Management said that sound policies and procedures, together with sufficient material disclosures, help investors understand an entity’s fair value process, the judgments involved, and the risks tied to private assets.