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IPEV Board Publishes Review Timeline For International Private Equity And Venture Capital Valuation Guidelines

The IPEV Board has started its 2021 review process and expects to publish the final revised IPEV Valuation Guidelines in Q2 2022. The slight extension to the timeline is to incorporate changes proposed by FASB to ASC Topic 820 (US GAAP) which would eliminate the ability to take a discount on a contractually restricted security (such as an underwriter’s lockup). The FASB’s proposals are in the consultation phase and the IPEV Board will wait until the changes are finalized before amending the guidelines 

For the 2021 review, the IPEV Board has issued a general call for feedback as it is not expecting to make significant changes to the guidelines. The IPEV Board proposes to incorporate:

• the guidance provided during the COVID-19 pandemic;

• further guidance on the valuation of early-stage venture investments and the calibration to the price of recent investment/funding rounds at each measurement date;

• changes made to ASC Topic 820, highlighting any differences to IFRS 13; and

• other feedback following the continued experience of industry practitioners applying IFRS 13 and ASC Topic 820.

The current Valuation Guidelines will continue to apply in the meantime.

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