Hamilton Lane INCHLNE

Hamilton Lane INC Fair Value Disclosure

10-KFiled May 21, 20263 min read
5. Fair Value Measurement
The following tables summarize the Company’s financial assets and financial liabilities recorded at fair value by fair value hierarchy level:
As of March 31, 2026
Level 1Level 2Level 3
NAV (1)
Total
Financial assets:
Consolidated Funds
Fair value investments107,379 — 6,305 391,553 505,237 
Total financial assets$107,379 $— $6,305 $391,553 $505,237 
As of March 31, 2025
Level 1Level 2Level 3
NAV (1)
Total
Financial assets:
Fair value investments
$— $— $12,190 $— $12,190 
Consolidated Funds
Fair value investments
— — 3,916 73,492 77,408 
Total financial assets$— $— $16,106 $73,492 $89,598 
Financial liabilities:
Secured financing(2)
$— $— $12,190 $— $12,190 
Total financial liabilities$— $— $12,190 $— $12,190 
(1) The fair value amounts presented in this column are intended to permit reconciliation of the fair value hierarchy to the amounts presented in Note 4.
(2) Secured financing is recorded within other liabilities in the Consolidated Balance Sheets.
The following table lists information regarding all investments recorded at estimated fair value based upon the NAV:
As of March 31,
20262025
Fair ValueUnfunded CommitmentFair ValueUnfunded Commitment
Direct investment funds$54,138 $8,097 $13,698 $1,232 
Secondary funds337,415 65,428 59,794 11,126 
$391,553 $73,525 $73,492 $12,358 
The investments valued under NAV can only be redeemed through distributions received from the liquidation of the underlying investments, and the timing of distributions is currently indeterminable.
The following is a reconciliation of fair value investments for which significant unobservable inputs (Level 3) were used in determining value:
Private equity fundsDirect equity investmentsTotal investments
Balance as of March 31, 2024
$5,519 $7,552 $13,071 
Contributions— — — 
Distributions(452)— (452)
Net (loss) gain (802)373 (429)
Transfer in— — — 
Transfer out— — — 
Balance as of March 31, 2025
$4,265 $7,925 $12,190 
Contributions9 — 9 
Distributions(15)(371)(386)
Net gain (loss)165 (1,201)(1,036)
Transfer in— — — 
Transfer out(1)
(4,424)(6,353)(10,777)
Balance as of March 31, 2026
$— $— $— 
(1) During the quarter ended March 31, 2026, the Company fully derecognized the investments held as collateral and related Secured financing liability that was previously recorded within other assets and liabilities, respectively in the Consolidated Balance Sheets.
The following is a reconciliation of investments held by the Company’s Consolidated Funds for which significant unobservable inputs (Level 3) were used in determining value:
Direct equity investments
Balance as of March 31, 2024
$— 
Contributions4,391 
Distributions(116)
Net gain20 
Transfer out(1)
(379)
Balance as of March 31, 2025
$3,916 
Contributions11,731 
Net gain25 
Transfer out(1) (2)
(9,367)
Balance as of March 31, 2026
$6,305 
(1) Transfer out relates to a change in valuation approach on an equity investment from Level 3 to NAV practical expedient based upon the availability of information.
(2) Transfer out relates to deconsolidation of a previously consolidated fund entity which held Level 3 investments.
The valuation methodologies, significant unobservable inputs, range of inputs and the weighted average input determined based upon relative fair value of the investments used in recurring Level 3 fair value measurements of assets were as follows:
March 31, 2026
 Fair ValueValuation Methodology
Investments held by Consolidated Funds
Direct equity investments$6,305 Recent precedent transactions

March 31, 2025
Fair ValueValuation MethodologySignificant Unobservable InputsRangeWeighted Average
Private equity funds$4,265 Adjusted NAVSelected market return(1.0)%— 1.4%(0.7)%
Direct equity investments$7,925 Adjusted NAVSelected market return0.62%0.62%
Investments held by Consolidated Funds
Direct equity investments$3,916 Recent precedent transactions
For the significant unobservable inputs listed in the table above, a significant increase or decrease in the selected market return would result in a significantly higher or lower fair value measurement, respectively.
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Historical Timeline

Fiscal YearFiled
2026May 21, 2026Showing above
2025May 30, 2025
2024May 23, 2024
2023May 25, 2023
2022May 26, 2022

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.

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