CISO Global, Inc. Fair Value Disclosure
NOTE 15 – FAIR VALUE MEASUREMENT
The following table sets forth our material liabilities measured and recorded at fair value on a recurring basis:
| As of December 31, 2024 | ||||||||||||
| Quoted prices in active markets for identical assets (Level 1) | Significant other observable inputs (Level 2) | Significant unobservable inputs (Level 3) | ||||||||||
| Current liabilities | ||||||||||||
| Derivative liability | $ | $ | $ | 2,102,927 | ||||||||
| Total liabilities measured at fair value | $ | $ | $ | 2,102,927 | ||||||||
The estimated fair value of the conversion feature of the derivative liability is based on Monte Carlo simulations, a traditional valuation model. The derivative liability component of the convertible notes are classified as Level 3 due to significant unobservable inputs.
Want the next CISO Global, Inc. fair value disclosure the moment it drops?
Set a Sentinel and we'll alert you the moment CISO Global, Inc.'s next filing hits EDGAR. No credit card, your email never gets sold.
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.