Fair value: Difference between revisions
imported>Doug Williamson (Links ordering.) |
imported>Doug Williamson m (Amend header.) |
||
| Line 13: | Line 13: | ||
3. | 3. | ||
''Financial reporting.'' | ''Financial reporting - accounting practices.'' | ||
The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between [[market participant]]s at the valuation date. | The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between [[market participant]]s at the valuation date. | ||
Revision as of 14:36, 29 October 2020
1.
The amount for which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm's length transaction.
2.
More specifically, the price at which an asset can be bought or sold in transparent markets, where contracting parties are informed and act in their best interest.
It represents the theoretical equilibrium price of securities or derivatives on open markets, for example, both buyers and sellers do not perceive them as overpriced or under-priced.
3.
Financial reporting - accounting practices.
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 valuation date.
Also known as Fair market value.
Relevant accounting standards include IFRS 13, and Section 9 and Section 19 of FRS 102.
