This was an education session and accordingly no decisions were made.

The session was led by representatives of the valuation profession to illustrate practical valuation concepts and issues (the complete presentation [Agenda Paper 11A] can be obtained from the Observer Notes section on the IASB Website). The focus was on the valuation methodologies used in the measurement of tangible and intangible non-financial assets.

The background of the session was the Discussion Paper on Fair Value Measurements that was issued by the IASB in November 2006.

The main topics of the presentation were:

• Value concepts in IFRSs
• The purchase price allocation process
• Overview of valuation methodologies (that is cost approach, market approach, income approach)

The presenters' main focus was the valuation requirements resulting from a business combination and what are the factors valuation professionals consider in such transactions.

Although this was an education session only the Board showed particular interest in certain topics of the presentation:

• If and how appraisers exclude entity-specific factors from their valuation models
• Customer-related intangible assets (separation and assumptions used in valuation)
• Consideration of tax in the valuation process
• Separation and valuation of contingent liabilities

On the last point, the representatives of the valuation profession admitted that they have difficulties identifying all contingent liabilities and how to value them based on a transfer notion (that is what would an entity have to pay to pass on the risk - in contrast to a settlement notion).