Refelecting on the Fair Value Under IFRS for SMEs: Challenges and Perspectives
International Financial Reporting Standards (IFRSs) require or permit various assets, liabilities and equity instruments to be measured at faire value. There are two distinct dimensions to the consideration of alternatives to fair value. The first is to examine alternative current values, and the second is to consider historical costs. Discussions of fair value often fall in to the trap of debating the relative merits of fair value and historical cost while ignoring the existence of alternative current values. Thus fair value can, wrongly, be regarded as the only alternative to historical cost. In order to avoid giving this false impression, the current discussion will focus first on alternative measures of current value.