A Retrospective View of the IFRS' Conceptual Path and Treatment of Fair Value Measurements in Financial Reporting

Document Type

Article

Publication Date

3-2011

Department

School of Business

Abstract

International Financial Reporting Standards (IFRS) require some assets, liabilities and equity instruments to be measured at fair value. Thus begins the Fair Value Measurement IASB 2009 Exposure Draft. This standard required that Inventory be valued at "fair value less costs to sell" for both reporting and disclosure purposes. This paper explores a brief historical path of fair value accounting within the venue of international accounting standards. Because of the impending plan of convergence and harmonization, plus potential global acceptance of standards of reporting and content, both the IASB and FASB have extensively explored the relevance and reliability of fair value reporting as compared with the more traditional cost-based system. In spite of the ongoing controversy of fair value versus historical cost accounting and the multiple uses and requirements of the fair value theoretical concept in IFRSs, there has been no definitive guidance on the various alternative calculations and appropriate uses of these differing representations of fair value.

First Page

23

Last Page

28

Volume

9

Issue

3

ISSN

15424448

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