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Last updated: 31 October 2020 A contract modification is a change in the scope or price (or both) of a contract that creates new, or changes existing, rights or obligations. Contract modification that is an additional separate contract A contract modification should be treated as a separate contract for accounting purposes when both of the … Read more

Last updated: 2 November 2020 For disclosure and comparability purposes, IFRS 13 establishes a fair value hierarchy that categorises the inputs to valuation techniques into three levels (IFRS 13.72): Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date. Level 2: inputs other … Read more

Last updated: 2 November 2020 The three widely used valuation techniques cited by IFRS 13 are the market approach, the cost approach and the income approach. Entities should choose a technique, or combination of techniques, that is most appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the … Read more

Last updated: 2 November 2020 A fair value measurement assumes that a financial or non-financial liability or an entity’s own equity instrument is transferred to a market participant at the measurement date. The transfer assumes the following (IFRS 13.34): A liability remains outstanding and the market participant transferee is required to fulfil the obligation. In … Read more

Last updated: 2 November 2020 Fair value is defined in IFRS 13 as 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 (IFRS 13.9). In other words, it is a current exit price and it is applicable … Read more