IES Holdings, Inc.IESC
IES Holdings, Inc. Fair Value Disclosure
16. FAIR VALUE MEASUREMENTS
Fair value is considered the price to sell an asset, or transfer a liability, between market participants on the measurement date. Fair value measurements assume that (1) the asset or liability is exchanged in an orderly manner, (2) the exchange is in the principal market for that asset or liability, and (3) the market participants are independent, knowledgeable, able and willing to transact an exchange. Fair value accounting and reporting establishes a framework for measuring fair value by creating a hierarchy for observable independent market inputs and unobservable market assumptions and expands disclosures about fair value measurements. Judgment is required to interpret the market data used to develop fair value estimates. As such, the estimates presented herein are not necessarily indicative of the amounts that could be realized in a current exchange. The use of different market assumptions and/or estimation methods could have a material effect on the estimated fair value.
At September 30, 2025, financial assets and liabilities measured at fair value on a recurring basis were limited to investments in equity securities and debt securities classified as trading securities, our Executive Savings Plan, under which certain employees are permitted to defer a portion of their base salary and/or bonus for a Plan Year (as defined in the plan), and contingent consideration liabilities related to certain of our acquisitions.
Financial assets (liabilities) measured at fair value on a recurring basis as of September 30, 2025 and 2024, are summarized in the following tables by the type of inputs applicable to the fair value measurements:
| September 30, 2025 | |||||||||||||||||
| Total Fair Value | Quoted Prices (Level 1) | Significant Unobservable (Level 3) | |||||||||||||||
| Equity securities | $ | 104,587 | $ | 104,587 | $ | — | |||||||||||
| Executive savings plan assets | 1,120 | 1,120 | — | ||||||||||||||
| Executive savings plan liabilities | (984) | (984) | — | ||||||||||||||
| Contingent consideration liability | (2,113) | — | (2,113) | ||||||||||||||
| Total | $ | 102,610 | $ | 104,723 | $ | (2,113) | |||||||||||
| September 30, 2024 | |||||||||||||||||
| Total Fair Value | Quoted Prices (Level 1) | Significant Unobservable (Level 3) | |||||||||||||||
| Equity securities | $ | 31,639 | $ | 31,639 | $ | — | |||||||||||
| Debt securities classified as trading securities | 3,364 | 3,364 | — | ||||||||||||||
| Executive savings plan assets | 986 | 986 | — | ||||||||||||||
| Executive savings plan liabilities | (852) | (852) | — | ||||||||||||||
| Contingent consideration liability | (3,468) | — | (3,468) | ||||||||||||||
| Total | $ | 31,669 | $ | 35,137 | $ | (3,468) | |||||||||||
On April 1, 2024, we entered into a contingent consideration arrangement valued at $2,790 in connection with the acquisition of Greiner Industries, Inc. (“Greiner”). A portion of the contingent consideration obligation related to Greiner was settled in cash for $2,500 in September 2025. The fair value of this liability, which was included in “Accounts payable and accrued expenses” in our Consolidated Balance Sheets, is measured on a recurring basis classified within Level 3 of the fair value hierarchy. The contingent consideration obligation related to Bayonet, which was acquired in fiscal year 2021, was settled in cash for $4,500 in December 2023. Net adjustments to fair value of such liabilities related to Greiner and Bayonet were included in in our Consolidated Statements of Comprehensive Income.
The table below presents the change in fair value of liabilities measured using significant unobservable inputs (Level 3).
| Contingent Consideration Agreement | |||||
| Fair value at September 30, 2023 | $ | (4,465) | |||
| Acquisitions | (2,790) | ||||
| $ | (713) | ||||
| Settlements | 4,500 | ||||
| Fair value at September 30, 2024 | $ | (3,468) | |||
| (1,145) | |||||
| Settlements | 2,500 | ||||
| Fair value at September 30, 2025 | $ | (2,113) | |||
Below is a description of the inputs used to value the assets summarized in the preceding tables:
Level 1 — Inputs represent unadjusted quoted prices for identical assets exchanged in active markets.
Level 2 — Inputs include directly or indirectly observable inputs other than Level 1 inputs such as quoted prices for similar assets exchanged in active or inactive markets; quoted prices for identical assets exchanged in inactive markets; and other inputs that are considered in fair value determinations of the assets.
Level 3 — Inputs include unobservable inputs used in the measurement of assets. Management is required to use its own assumptions regarding unobservable inputs because there is little, if any, market activity in the assets or related observable inputs that can be corroborated at the measurement date.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Nov 21, 2025 | Showing above |
| 2024 | Nov 22, 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.