AC2101 S1 2014 Seminar 2.pptx

G nrv in frs 2 7 frs 113 fair value measurement

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Unformatted text preview: sue FRS 113 *  Discuss Seminar Question 2 6 3 FRS113 – Fair Value Measurement §༊  Objective §༊  Defines FV §༊  Sets out a framework for measuring FV in a single FRS §༊  Requires FV measurement disclosures §༊  Measurement and disclosure requirements of FRS 113 do not apply to the following: §༊  Share- based payment transactions under FRS 102 §༊  Leasing transactions under FRS 17 §༊  Measurements that have some similarities to fair value but are not fair value, e.g. NRV in FRS 2 7 FRS 113 – Fair Value Measurement §༊  Definition of fair value An exit price An exit price …the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date Current price Not a liquidation or forced sale. Assumes that the transaction takes place in either the principal market / most advantageous market Market- based transaction (i.e., not entity- specific) 8 4 FRS 113 – Fair Value Measurement §༊  Framework for measuring fair value (From FRS 113 para IN9) §༊  Determine the particular asset or liability being measured §༊  For a non- financial asset, determine the highest and best use of the asset §༊  Determine the market in which an orderly transaction would take place for the asset or liability §༊  Determine the appropriate valuation technique to use §༊  Maximise the use of relevant observable inputs and minimise unobservable inputs. 9 FRS 113 – Fair Value Measurement §༊  A fair value measurement of a non- financial asset takes into ac...
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This document was uploaded on 02/10/2014.

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