In April 2000 the G4 1 Group acknowledged that market exit value is generally regarded as

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In April 2000 the G4  1 Group acknowledged that market exit value is generally regarded as the basis for fair value measurement of financial instruments and was discussing the use of the deprival value model for the measurement of non-financial assets or liabilities, especially in cases in which the item is highly specialised and not easily transferable in the market in its current condition.

The deprival value model would require that an asset or liability be measured at its replacement cost, net realisable value, or value in use, depending on the par ticular circumstances.

(a) Discuss reasons why financial and non-financial assets should be measured using different bases.

(b) Explain what is meant by ‘depending on the par ticular circumstances’.

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Financial Accounting And Reporting

ISBN: 9780273712312

12th Edition

Authors: Barry Elliott, Jamie Elliott

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