Post-implementation review of IFRS 13 completed

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Dec 14, 2018

On December 14, 2018, the International Accounting Standards Board (the Board) published a summary report on its Post-implementation Review (PIR) of the fair value measurement Standard, IFRS 13, "Fair Value Measurement", which showed that the Standard works as intended.

During the PIR, the Board focused on the following matters:

  • the usefulness of information disclosed about fair value measurements — to gain a deeper understanding of both users’ and preparers’ perspectives on the usefulness and costs of fair value measurement disclosures;
  • whether to prioritise Level 1 inputs or the unit of account — to further assess the extent and effect of the issue as well as to examine current practice;
  • application of the concept of the highest and best use when measuring the fair value of non-financial assets —  to better understand the challenges of applying this concept and decide whether further support could be helpful; and
  • application of judgement in specific areas — to assess the challenges of making judgements and decide whether further support could be helpful.

The conclusions were that the information required by IFRS 13, Fair Value Measurement is useful to users of financial statements. Some areas of IFRS 13 present implementation challenges, largely in areas requiring judgement, However, evidence suggests that practice is developing to resolve these challenges. No unexpected costs have arisen from application of IFRS 13. Thus, the Board concluded that the standard works as intended.

The findings from the PIR regarding the usefulness of information disclosed will feed into the Board's work on better communication, in particular into the projects on targeted standards-level review of disclosures and on the primary financial statements. The Board will also continue liaising with the valuation profession, monitor new developments in practice and promote knowledge development and sharing. Other than that the Board does not intend to conduct any other follow-up in response to findings from the PIR.

Review the press release and PIR report on the Board’s website.

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