Company: ATLCL
Filing Date: 2025-11-10
Form Type: 10-Q
Source: 0001437749-25-033947
Chunk: 179

Company: Atlanticus Holdings Corp
Filing Date: 2025-11-10
Form: 10-Q
Item: Item 1
Chunk 179
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 orderly transaction between market participants on the measurement date.
    
   We update our fair value analysis each quarter, with changes since the prior reporting period reflected as a component of "Changes in fair value of loans" in the condensed consolidated statements of income. Changes in yields, purchase and payment rates, servicing rates, realized and projected credit loss rates and discount rates will lead to changes in the fair value of loans and therefore impact earnings. Further, our retail asset typically has seasonal growth during the summer months, impacting the fair value of assets.
    
   Fair value differs from amortized cost accounting in the following ways:
    •Receivables are recorded at their fair value, not their principal and fee balance or cost basis;
 •The fair value of the loans takes into consideration net charge-offs for the remaining life of the loans with no separate allowance for credit loss calculation;
 •Certain fee billings (such as non-refundable annual fees) and expenses of loans are no longer deferred but recognized (when billed or incurred) in income or expense, respectively;
 •The net present value of cash flows associated with future fee billings on existing receivables are included in fair value;
 •Changes in the fair value of loans impact net margins; and
 •Net charge-offs are recognized as they occur rather than through the establishment of an allowance and provision for credit losses for those loans, interest and fees receivable carried at amortized cost.

   For receivables that are carried at net amortized cost, we include disclosures of the fair value of such receivables to the extent practicable within the disclosures below.
    
   Where applicable, we account for our financial assets and liabilities at fair value based upon a three-tiered valuation system. In general, fair values determined by Level 1 inputs use quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Fair values determined by Level 2 inputs use inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability