Recently, a large value fund managing about $10 billion dollars in assets decided to close its operation. It was just one of numerous value funds, managing trillions of dollars, that have seen their worst performance in the last 200 years. Those aren’t just any dollars either — they include pension and retirement funds and lifetime savings. So why are these value funds closing en masse? To do our analysis of this question, we reviewed our research and revisited our earlier HBR article, “Why Financial Statements Don’t Work for Digital Companies,” to explain these new developments. But more importantly, we believe these closures make reforming financial reporting even more urgent. Without such reform, investors will continue to create their own, half-baked solutions, which harm their cause more than help it.