GEN Restaurant Group, Inc. Fair Value Disclosure
The Company's financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, operating lease liabilities, notes payable, and line of credit balances. The carrying amounts reported in the accompanying consolidated balance sheets for cash and cash equivalents, accounts receivable, accounts payable, notes payable, and line of credit balances approximate fair value because of the short-term maturity of those instruments. Fair value measurements are classified and disclosed in one of the following three categories:
Level 1 - Quoted prices in active markets for identical assets or liabilities.
Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets of liabilities.
As of December 31, 2025, all of the Company's financial assets that were subject to fair value measurement were valued using observable inputs. The Company's financial assets valued based on Level 1 inputs consist of cash, money market funds, and U.S. treasury securities.
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Fair Value Measurements at December 31, 2025 |
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(in thousands) |
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Total |
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Level 1 |
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Level 2 |
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Level 3 |
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Money Market Account (included in Cash and Cash Equivalents) |
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$ |
1,058 |
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$ |
1,058 |
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$ |
— |
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$ |
— |
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U.S. Treasury Securities (included in Cash and Cash Equivalents) |
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$ |
55 |
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$ |
55 |
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$ |
— |
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$ |
— |
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Fair Value Measurements at December 31, 2024 |
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Money Market Account (included in Cash and Cash Equivalents) |
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$ |
6,459 |
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$ |
6,459 |
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$ |
— |
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$ |
— |
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U.S. Treasury Securities (included in Cash and Cash Equivalents) |
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$ |
14,317 |
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$ |
14,317 |
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$ |
— |
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$ |
— |
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 31, 2026 | Showing above |
| 2024 | Mar 10, 2025 | |
| 2023 | Mar 6, 2024 | |
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.