Constituents are better served with a consistent definition of fair value across different accounting standards when fair value is intended to have the same meaning across those accounting standards. As the Board recognises in its invitation to comment there are differences in the meaning of fair value in current standards. Before an exposure draft can be issued, a thorough analysis of all standards is needed to establish where the term fair value is currently used, what it is intended to mean. Without this analysis we do not believe an overarching measurement standard, defining current value¹ measurements, can be developed. In addition, fair value measurement, as defined in the DP, is only one measurement attribute. We are not convinced that this represents the most relevant attribute for all items.

The DP concludes fair value is an exit price based on a transfer (as opposed to a settlement). Current IFRSs use the term fair value as meaning sometimes an entry price, sometimes an exit price, sometimes based on a transfer and sometimes based on a settlement. We believe that rather than removing these different terms by having a standardised definition of fair value which we believe in some instances would lead to an inappropriate treatment, recognition should be given to these different terms as we believe that all of them have a place in accounting literature. As such, the term 'fair value' should be dropped as it means different things to different people.

¹ The term 'current value', as opposed to fair value, is purposely used in this letter to mean the measurement attribute of reflecting what an item is currently worth. When describing this measurement attribute the term fair value is not always used as this results in confusion as there are many different definitions of fair value.