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Fair Value Measurement in PFRS

The document discusses the requirements for measuring certain assets at fair value according to PFRS, emphasizing the necessity of the fair value hierarchy. It also evaluates statements about fair value, identifying that statements III and IV are correct, while statement I is incorrect. Additionally, it notes that the impairment approach is not a valid valuation technique for measuring fair value.

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10 views1 page

Fair Value Measurement in PFRS

The document discusses the requirements for measuring certain assets at fair value according to PFRS, emphasizing the necessity of the fair value hierarchy. It also evaluates statements about fair value, identifying that statements III and IV are correct, while statement I is incorrect. Additionally, it notes that the impairment approach is not a valid valuation technique for measuring fair value.

Uploaded by

jelou ubag
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

CFAS Chapter 29 Problem 1

1. The PFRS requires some specific assets to be measured at fair value. Before fair value can be
used as the basis for subsequent measurement, which of the following conditions must
exist? The fair value must be determined using the fair value hierarchy.
2. Which of the following statements regarding fair value is/are correct?
I. Fair value is an entity-specific measurement.
II. Fair value is the price to acquire an asset or assume liability.
III. Fair value includes transportation costs, but not transaction costs.
IV. The price in a principal market, if one exists, is used to measure the fair value of an
asset or liability.
III and IV

3. Which of the following is not a valuation technique that can be used to measure the fair
value of an asset or liability? Impairment approach

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