Fair Value Measurements — Expert Advisory Panel on Valuing Financial Instruments in Inactive Markets: Meeting update

Date recorded:

The project manager on the fair value measurement project gave an oral update on the activities of the expert advisory panel. The purpose of this panel is to assist the IASB in reviewing best practices in the area of valuation techniques as well as formulating any necessary additional guidance on valuation methods for financial instruments and related disclosures when markets are no longer active.

The panel or subgroup met three times. At the kick-off meeting the panel identified specific issues that panel members felt must be addressed (such as forced transactions, the use of pricing services, illiquid markets).

It was noted that there seemed to be consistency in applying the fair value measurement requirements in IAS 39 despite the use of different techniques.

The staff informed the Board that there will be a draft document to be discussed end of July on those issues, but that it is not clear yet who will publish it. The panel would then turn to appropriate disclosures with the aim to have an exposure draft published in Q4/08. It was noted that there would be ongoing communications with the consolidations project team.

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